Hafskip was

Iceland Iceland ( is, Ísland; ) is a Nordic island country in the North Atlantic Ocean and in the Arctic Ocean. Iceland is the most sparsely populated country in Europe. Iceland's capital and largest city is Reykjavík, which (along with its s ...

's second-largest shipping line before its collapse which became a national scandal. The firm had fallen deep into

debt Debt is an obligation that requires one party, the debtor, to pay money or other agreed-upon value to another party, the creditor. Debt is a deferred payment, or series of payments, which differentiates it from an immediate purchase. The ...

through its investment in new ships, intended to help the firm compete with

Eimskip Eimskipafélag Íslands hf. is an international shipping company with 55 offices in 20 countries and four continents; Europe, North America, South America and Asia. Eimskip specializes in worldwide freight forwarding services with focus on frozen ...

and American shipping firms in the transatlantic shipping trade. It was declared bankrupt on December 6, 1985; this led in turn to the collapse of its main lending bank, Útvegsbanki (the Fisheries Bank of Iceland). Partly because of Hafskip's ties to Iceland's finance minister Albert Guðmundsson, who was its former

chairman The chairperson, also chairman, chairwoman or chair, is the presiding officer of an organized group such as a board, committee, or deliberative assembly. The person holding the office, who is typically elected or appointed by members of the grou ...

and still a

shareholder A shareholder (in the United States often referred to as stockholder) of a corporation is an individual or legal entity (such as another corporation, a body politic, a trust or partnership) that is registered by the corporation as the legal own ...

at the time of the firm's collapse, Hafskip's bankruptcy became a fuel for rival politicians, and ignited a criminal investigation which lasted six years.

Björgólfur Guðmundsson Björgólfur Guðmundsson (born 2 January 1941) is an Icelandic businessman and former chairman and owner of West Ham United. Björgólfur was Iceland's second wealthiest businessman worth more than a billion dollars — his son, Björgólfur T ...

, Hafskip's managing director, and the Hafskip executives Pill Bragi Kristjónsson, Ragnar Kjartansson and the company's auditor, Helgi Magnússon, were detained and later charged with 450 criminal counts, from

embezzlement Embezzlement is a crime that consists of withholding assets for the purpose of conversion of such assets, by one or more persons to whom the assets were entrusted, either to be held or to be used for specific purposes. Embezzlement is a type ...

fraud In law, fraud is intentional deception to secure unfair or unlawful gain, or to deprive a victim of a legal right. Fraud can violate civil law (e.g., a fraud victim may sue the fraud perpetrator to avoid the fraud or recover monetary compens ...

. Björgólfur Guðmundsson was found guilty on five counts of minor

bookkeeping Bookkeeping is the recording of financial transactions, and is part of the process of accounting in business and other organizations. It involves preparing source documents for all transactions, operations, and other events of a business. Tr ...

offenses and sentenced to 12 months' probation. There was also another scandal with the same company that happened in 1978. But the second incident was larger.

References

External links

The Hafskip Affair - Article by Örnólfur Árnason, in the compendium Ísland í aldanna rás 1900-2000
* Lee, Peter, 'Landsbanki's New Masters Take Control', ''Euromoney'', vol. 33 issue 403 (November 2002), pp. 34–47 Corporate scandals Shipping companies of Iceland {{Iceland-company-stub

See also

References

External links