While the world economy struggles to recover from the 2008 financial crisis, most of the bankers who caused the collapse are still collecting massive salaries and have faced few, if any, consequences.
Except in Iceland.
In one of the countries hit hardest by the collapse, 29 bankers have now been sentenced to prison for their roles in the crash. According to, Stefan Simanowitz, writing for The Huffington Post on Jan. 5, “Just before Christmas, the former CEO of Iceland’s Glitnir bank and two other senior bankers were sentenced to jail terms of up to five years for market manipulation and breach of fiduciary duties.”
Simanowitz questioned why the United States and the United Kingdom, for example, have been far more lenient on their banks.
“[N]ot a single senior banking executive in the US or the UK has been jailed for their role in the financial crisis. Whilst banks — such as the five found to be rigging the Libor rate — have been hit with substantial fines, the individual bankers behind the fraud, market rigging and irresponsible lending that led to the economic meltdown have all avoided time behind bars.”
In October, Alan Pyke, the deputy economic policy editor for ThinkProgress, outlined some of the ways Iceland’s approach differed from that of other countries:
“Like other countries with a large financial industry presence, Iceland spent a lot of money on bailouts after the crisis. But it bailed out workaday citizens instead of bankers, forgiving mortgage debts that exceeded 110 percent of the actual value of the home linked to the loan. The banks, which had swarmed to the north Atlantic island after aggressive deregulation of Icelandic finance law around the turn of the century, were allowed to fail and go bankrupt.”
(keep reading at mintpressnews.com)