Iceland arrests former Kaupthing chief executive over debt crisis

THE former chief executive of the collapsed Icelandic bank Kaupthing has been arrested.

Hreidar Mar Sigurdsson is suspected of embezzlement, trading irregularities, and other breaches of banking laws, the special prosecutor’s office has said.

Kaupthing was the largest of the three Icelandic banks which collapsed within a week in October 2008 under a mountain of debt.

Iceland named a special prosecutor in September last year to investigate possible wrongdoing in the lead-up to the banks’ fall.