Reykjavík Grapevine - 06.11.2009, Page 11

Ólafur Hauksson, the Special Prosecutor
in charge of investigating the financial
crimes that helped bring Iceland’s
banking system to its knees, has said
that his office is making progress in its
inquiry, though it still faces challenges
in its quest to bring criminal bankers to
justice.
To date, although about seven or eight
cases have either already been wrapped
up or dismissed in court. Hauksson says
that his team has worked on roughly
fifty cases in total. With a report from
Alþingi set to be released in February
about financial crimes in the run-up
to the kreppa, it would not be a stretch
to say the number of cases that land on
Hauksson's desk may grow in the coming
months. “The institution is expanding
and growing with the workload,” he said,
adding that three new prosecutors have
recently joined the team at its Laugavegur
office.
Not surprisingly, one reason that the
Special Prosecutor's office is expanding
is because investigations have taken
on a global scope. Akranes resident
Hauksson has already been to London,
where he met with British officials from
the Serious Fraud Office (SFO). Though
he was unable to divulge too much
information about where in the world the
investigation will lead him, Hauksson
revealed that Luxembourg—that bastion
of financial integrity—is a real place
of interest for the Special Prosecutor's
office. Hauksson's partner-in-crime, Eva
Joly, also told national broadcaster RÚV
that the Norwegian State Prosecutor has
offered assistance. Both the British and
Norwegian assistance were described by
Hauksson as being “very positive.”
“HEAvY BURDEN”
The Special Prosecutor’s office has
already been successful in recovering
some tainted assets. Hauksson said that
a “serious amount” of cash in connection
to Kaupþing’s takeover of Sainsbury has
already been recovered, for example, but
some assets may never be recovered.
“A heavy burden of proof is on the state
before it can make a decision [to freeze
assets],” he explained. Though some of
the money may be sufficiently hidden
or spent by the time criminal financiers
have been charged, this will not entice
him to act rashly.
“You have to be thorough. We cannot
afford to have cases thrown out in court.”
The October 1st raid of accounting firms
KPMG and PricewaterhouseCooper's
Reykjavik offices, for example, has not yet
yielded leads to other monetary mischief.
“There is a huge amount of information
to go over,” Hauksson said. “It is much
too soon to give information about that.”
As the name suggests, forensic
accounting is a painstaking process.
Pesky journalists aren't much of a
help either to a man whose job it is to
be as discreet as possible for as long as
possible. Has the Special Prosecutor been
working with Russian law enforcement?
“There have been news stories abroad
that we haven't commented on,” he said,
in a possible reference to a 2006 Danish
newspaper report that Icelandic banks
were helping Russians launder money.
What about [former Kaupþing executive]
Sigurður Einarsson, who, according to the
Guardian, has been named as a suspect
and is currently in London? Are you
worried he may try to avoid extradition?
“We haven't given any information about
individual's statuses and who has been
asked to come in for questioning,” he
replied. “Most of those we have requested
to come to Iceland have appeared.”
Thus the responsibility of being
Iceland's top cop in charge of going
after arguably the country's most hated
criminals in its history does not seem to
get to Hauksson, who has been working
in law enforcement since 1989. “Pressure
in this line of work isn't a new thing,”
he exclaimed with a chuckle when
asked if he found it difficult to maintain
objectivity in such troubled times.
But there is only so much that
Hauksson and his team of financial
cops can do. The Special Prosecutor's
mandate does not include a fact-finding
mission. Whistleblowers are welcome
to directly tell the Special Prosecutor's
office anything they might know, which
they can do either by phone or online, but
information comes to the office primarily
from the Financial Services Authority
and task forces established by the new
banks.
Though it might seem a bit odd
that Hauksson's team must rely on
information provided to it by people with
some connection to the old banks, he
described the new banks’ information as
‘helpful.’ “Glitnir, for example, has hired
auditors to run over everything to see if
money was loaned illegally. Kaupþing has
done the same,” he said, adding that the
old Landsbanki winding-up committee
has also cooperated.

HoW FAR DoES THIS
RABBIT HoLE Go?
Just how long the Special Prosecutor's
office will remain in existence is unclear,
though more will be known when
parliament issues its report in February.
At first, the Special Prosecutor's office
was only supposed to cover the time
just before and after the collapse. It has
since broadened its investigation, and the
office may still exist after February 1st,
2011, when a review by the Alþingi on the
status of the Special Prosecutor's office
will take place.
Much of Hauksson's work is currently
focused on stock market manipulation
facilitated by illegal loans, though as
the investigation matures, even the
privatization of the banks themselves
may come under his scrutiny. Hauksson,
however, will have to wait on orders from
above to see where the inquest is going.
“It is a matter that will be touched upon
by the Parliament committee's report,”
he said in closing.
The Reykjavík Grapevine
Issue 17 — 2009
11
Ólafur Hauksson is the man responsible for bringing those responsible for the biggest messes of
our financial crisis to justice. That's a pretty hefty job, right there.
SAMUEL kNIGHT
JULIA STAPLES
REBECCA LoUDER
ÞÓRSTEINN SIGURÐSSoN
Interview | Financial Crimes
Special Prosecutor:
Investigation progressing, maturing
Article | Housing
Making use of the abandoned spaces in Reykjavík
Up until a year ago, Reykjavík was in the
throes of a serious building boom. Projects all
over town planned to tear down the old and
put in new shopping malls and high-rises.
Tenants of older buildings were being forced
out by rising rent prices and the owners were
chomping at the bit of sweet deals being
offered to them for their properties.
When the shit hit the fan last October,
the construction industry took one of the
first big hits on the chin. From one day to
the next, the money was gone and projects
were immediately put on ice. Businesses all
throughout downtown were going bankrupt
and closing up shop, buildings that were sold
to be demolished stood vacant and forgotten.
However, some people began to see the
potential for the phoenix to rise from the
flames of these deserted shells. Groups of
artists and creatively inclined individuals
began appropriating spaces into workshops
and galleries. This did not necessarily fly over
too well with building owners and obstacles
were thrown in the path of those trying to
bring new life into the quickly dying city
centre. I recently spoke with two of these
industrious individuals about their projects
and the challenges they faced.
Doing it by the book
Hlín Helga Guðlaugsdóttir, managing director
of the Aurora Design Fund, set up the Design
March in March 2009. She told me that the
group targeted empty, abandoned spaces all
along Laugavegur with the aim to bring new
life to the street that was rapidly losing air
and show that these spaces could be used
for something else. However, over the course
of January to March, more and more empty
spaces were cropping up and it started to look
like they bit off more than they could chew.
“It was so difficult,” Hlín told me, “when we
started there were thirty designers wanting to
do something, and there were five or seven
empty spaces. By the time we did it in March,
there were thirty.”
The group went about acquiring these
spaces by contacting the building owners
to borrow the space, but were immediately
challenged. “It was quite difficult to get them
to lend the spaces for a couple of days,” she
says, “finding the building owners by going
through real estate agents to talk to them,
that was the headache.” Hlín attributes
the reluctance of building owners to lend
them the space to indifference. “I think they
couldn’t be bothered in a way,” she goes on, “I
think they were also afraid that we would do
something and mess it up. Some of them were
instantly positive and understood that it was
an opportunity, but others just didn’t see the
point.”
Eventually it all came together and the
group got eight spaces up and running, all
of which they worked hard to clean and give
a fresh coat of paint. They then threw an
opening party which led into a walk along
Laugavegur to visit all their locations. Hlín tells
me that she received lots of positive feedback
from people who were glad to see the street
alive again. Reykjavík mayor Hanna Birna
Kristjánsdóttir paid a visit to the event as well.
A couple of days later, Hlín was asked by
the city to continue a project to revitalize
Laugavegur’s empty spaces. She worked with
designers to split them into small groups that
would occupy spaces together and has now
stepped back from the project, but continues
to oversee the situation in 101 and assess if
they need to become more proactive.
“We took it.”
Not everyone has chosen to go about the
most legal means of acquiring space. A
group of young street artists, The Pretty
Boys, recently opened the Gallery Bosnia at
Hverfisgata 34. The group had taken notice of
the amount of abandoned space in 101. They
had originally planned to covertly take spaces
a week at a time, quickly set up their display,
throw one big party and move on to another
location. They busted their way into the locale
on Hverfisgata in June, cleaned and white-
washed it in one week and threw an opening
party, where a dozen cops showed up asking
them to shut off the music and get the party-
goers out. They boarded up that night and
came back the next day with fresh plans.
“We started to look into the prospect
of making it ongoing,” Pretty Boy Geoffrey
Thor Huntingdon-Williams told me, “we were
getting quite attached to the place and we
didn’t want to leave, basically. There was no
one who was ripping us out, so we said ‘okay,
let’s just stay here a bit longer.’”
The group then contacted Central City
Director Jakob Frímann Magnússon, who
already knew the guys from their involvement
with the Reykjavík graffiti scene. With his
help, they managed to get the go-ahead from
the building owners to occupy the space rent
free and properly open a gallery. The group
did a second clean up of the space, working
day and night until they finally opened their
doors on Menningarnótt, which Geoffrey feels
went very well.
Bust in vs. call ahead
So which method is simpler and most
effective? It seems as though the going about
the legal process of finding the owners and
requesting permission for use of the spaces
can be a pain in the ass, but the pay off is
worth it. Hlín stressed this point to me as
well. After gaining the mayor’s approval and
speaking to people on the city council about
her new project on Laugavegur, she placed
fresh calls to the building owners she had
spoken with to prior to her project and was
met with an overwhelming positive response.
“I’m pro-activism, but I think there is a line
where you have to have credibility to make
good things happen,” she says, “Taking a
space might be a good and necessary means
to communicate what you believe in and make
a statement, but I think that if you want to
build something up, I believe in getting direct
dialogue and selling your ideas.”
She also suggests that a young artist
without a degree and no money can build
legitimacy by grouping with other artists and
getting a spokesperson.
Hlín does see the other side of the coin
though. “In some cases I think it’s necessary
to take over houses,” she goes on, “Some
houses are really neglected, in really bad
shape and people are just letting them rot.
They don’t care about the property, they care
about the land, so they let them rot so they can
get permission to build earlier.” This was the
case with Gallery Bosnia’s space. The building
was a run-down eyesore that the owners
were neglecting, according to Geoffrey, and
despite a few snags with the law, he says they
ultimately didn’t face any real hassles when it
came to getting permission to use it.
He also points out that his group didn’t
take their space to make a political statement,
but rather they went about this route to make
something beautiful out of something that
was rotting away.
“I’m not squatting and we’re not waving
black flags,” he says, “it’s not a political
manoeuvre. We just wanted to make
something nice and do something fun.” One
thing both Geoffrey and Hlín agree on is that
people need to take initiative to transform
these spaces into worthwhile endeavours,
and not let abandoned space go to waste.
Refilling 101