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    The Islandsbanki may have broken the law

    The Financial Supervisory Authority of the Central Bank of Iceland believes that Islandsbanki may have violated the provisions of the law that apply to the bank and its operations, during the bank’s sales process in March.

    This is stated in the supervisor’s initial assessment, according to an announcement from Islandsbanki.

    Islandsbanki has received the preliminary assessment due to the examination of the bank’s implementation of the Banking Authority’s auction of the government’s 22.5% holding in Islandsbanki, which took place on March 22 last year.

    The bank says it takes the initial assessment seriously

    In Islandsbanki’s announcement, it is stated that in the initial assessment, attention is drawn to FME’s authority to impose administrative fines and settle the case amicably.

    “A conciliation process has begun and in the coming weeks the bank will present its explanations and views on FME’s initial assessment,” says the announcement.

    “The bank’s managers take FME’s initial assessment seriously. As previously reported, the bank has already made changes to internal rules and processes and will continue such work during the reconciliation process.”

    Birna Einarsdottir, Bank Manager of Islandsbanki, has declined to be interviewed.

    Employee participation criticized

    It has previously been stated that eight employees or persons closely related to employees of Íslandsbanki bought into the bank when the auction was held in March. In the bank’s answers to a Magazine inquiry in April last year, it was stated that its employees who bought shares had not been insiders.

    An employee of the securities brokerage Islandsbanki, who was in charge of the auction when the government’s share in the bank was sold, bought the bank for over a million ISK.

    In addition to being an employee of a brokerage firm, the department manager bought Islandssjoda, which is owned by the bank, for 4.5 million ISK. It was not announced that these parties were insiders in the auction, but in addition to them, six other employees or closely related to the bank’s employees bought in the auction.

    As a result, Islandsbanki said it intends to change its rules regarding employees’ securities transactions, but the participation of the bank’s employees in the tender had been strongly criticized.

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