The case of Glitnir lending money to children aged 1-17 for shares in BYR Savings & Loans is so filthy it is hard to grasp.
The bank, with current CEO Birna Einarsdottir as a top manager allowed the parents of ten children to borrow up to 24 million ISK in their name.
Amid public outcry over the immorality and illegality two parents have stepped forward and cannot see what they themselves have done wrong.
Iceland in a nutshell these days. Newspaper DV has been on the case.
One of the parents, Einar Orn Jonsson blames the bank, and says it should have told him this was illegal. For children to acquire debt, approval must be had from the local authorities and that was not done. Even if it had been, it would have been unlikely to have been granted. Einar says he was operating in false hope and since the bank had approved of the loans he had seen no reason to question them.
Sigrun Karlsdottir, the wife of BYR’s former chairman of the board and mother of children who were granted loans is hurt and angry. “I am not crazy. I am very responsible as a parent. My children owned shares in BYR and participated in the hope they wouldn’t be diluted. Glitnir offered the loans and wrote to us that the only collateral would be in the shares themselves.”
Vilhjalmur Bjarnason, chairman of the Independent Investors’ Coalition says that the staff of Glitnir was clearly unfit to work in a bank. Of course bankers often have insane people knocking at their asking for loans. The bank’s response should be “sorry, this is against all rules and laws so get out”, but in this case it didn’t. The bank knows that it cannot lend money to people who are under-age but it still does. It describes its stupidity first and foremost. These people are stupid and immoral and should not be anywhere close to finance.
The ombudsman for children has expressed outrage over the whole thing. The tragic thing is that the parents of the children will have the loans written off. So they would have reaped the benefits and not assumed the risk. A familiar theme in Icelandic banking these days.
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Bert Pachetta
10 months ago
Regarding Einar Orn Jonsson and Sigrun Karlsdottir, it appears that Darwin´s natural selection process went awry!
kría09
10 months ago
If somebody had taken out a bullet loan in the name of his guinea pig, I wouldn’t be surprised any more – stupidity without limit.
'Children Borrowing Money From Glitnir' - World - City-Data Forum
10 months ago
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