At the beginning of 2009 no one could have imagined that ex-P.M. Haarde would be criminally charge for ministerial incompetence in connection to Iceland’s financial melt down.

The financial crisis in Iceland was investigated by Special Investigations Commission  (SIC).  The committee conducted a thorough investigation of the facts and circumstances  which supposedly lead to the economic meltdown. The general consensus is that  the committees investigation was undertaken to place political responsibility for the country’s turn of fortunes. Regardless of the reports origins, the committee’s in-depth and highly analytical examination of meltdown served to expose a disturbing degree of politics in the management of the nation’s banking industry. The committee was also tasked with determining the culpability of  governmental officials who government at the time. In an effort to define the  limits of this part of its investigation, the SIC stated the following in its report:

“Secondly, the general meaning of the terms „mistake“ and „negligence“ is wider than simply  meaning whether taking action or not taking action constitutes an
infringement of the law, to the extent that it may give rise to relevant legal
penalties of some sort, be it damages, penal measures or, as the case may be,
disciplinary action such as reprimand or dismissal in case of a civil servant. In
keeping with this, the commentary pertaining to Article 1 of Act No. 142/2008
states that mistakes and negligence do not only refer to certain actions not
fulfilling legal requirements or negligence in following legal provisions. More
scenarios can fall under the scope of these terms, such as the incorrect
assessment of available information and decision-making based on inadequate
assumptions. Further, failure to react appropriately to information regarding
an imminent risk could also be regarded as negligence. It is emphasised that
these terms were set forth in an independent legislation adopted by
Althingi with the SIC investigation especially in mind. Consequently Althingi
has, through special legal criteria, established the framework around the
SIC´s evaluation of the conduct of individuals on the grounds of Article
1(1) of Act No. 142/2008. It cannot be assumed that such criteria is fully
comparable to criteria pertaining to other legal rules which may apply to the
involvement of individuals in events leading to the collapse of the Icelandic
Banks.”

In my opinion the SIC did everything possible to remove  the appearance political considerations from it work. Legal counsel for the SIC was keenly aware that the committee’s deliberations and recommendations had to be accepted as  impartial, scholarly and legally grounded. I believe that the SIC accomplished this goal. The SIC concluded that a number of officials should be held accountable for mistakes and negligence.

After a long and heated debate over the findings and  conclusions of the SIC’s  report, the Icelandic Parliament voted 33-30 in  September 2010 to recommend the filing of criminal charges against only former P.M., Heir Haarde. The Parliament did not accept the full recommendation(s) of  the SIC. Mr. Haarde was referred to a special court, the Landsdomur, which will  convene and consider the charges against him. A special prosecutor was also appointed to represent the interests of the State.

The decision to seek criminal charges against Mr. Haarde has deeply divided Icelanders. Those opposed to the criminal proceedings point out that no other person who served during the meltdown is being charged. They argue that one person cannot have been responsible for the country’s financial problems. Gudni Th. Johannesson, a historian with the prestigious Reykijavik Academy,  stated that “Over the past two years, banks all over the world have  collapsed and economies faltered. Obviously, heads of state have been indicted before for war crimes, such as Slobodan Miloševi? and Charles Taylor, but never  for anything such as economic mismanagement.”

Arguing the contrary Gunnar Helgi  Kristinsson, a professor of political science at the University of Iceland, believes that the indictment of Haarde is a good thing for the country. The charges serve notice to politicians that their  governmental duties carry great responsibility; “they should not sit there and look pretty.”