The Kaupthing share support operation | FT Alphaville

The Kaupthing share support operation

You’ve read the story in the FT

Lawyers acting for the UK arm of the collapsed Icelandic bank Kaupthing, which is at the centre of a fraud probe, have withdrawn a request to retail entrepreneur Kevin Stanford to repay nearly $2m (£1.2m) as part of efforts to recover funds owed to the bank….

In a response to KSF’s demand, Mr Stanford’s lawyers said he rejected the claim and instead demanded at least £130m in respect of losses that he said arose from KSF’s participation in a share support scheme in 2008. Mr Stanford claims Kaupthing lent him about £130m for the purchases of his Kaupthing Iceland shares, and £81m of this was loaned as late as August 2008, just two months before Kaupthing Iceland went into administration.

…. now read the letters.

Here are the legal exchanges between the lawyers for the fashion tycoon and DWF, the lawyers acting for the UK arm of the collapsed Icelandic bank Kaupthing.

Now, Stanford’s lawyers make some serious allegations in the letters, on which the Kaupthing side has thus far declined to comment.

For example, here’s what administrators Ernst & Young had to say:

Kaupthing Singer & Friedlander (In Administration) has followed its normal procedures to recover amounts outstanding to the bank to allow them to pay back the bank’s creditors who are principally the UK taxpayer.

The bank and its advisors will respond appropriately to any correspondence received.”

So please bear that in mind as you read the excerpts.

And the DWF letter:

Related links:
Resolution Committee and the Winding-up Committee – Kaupthing Bank
Kaupthing Bank – Wikileaks