Court convicts man of embezzling EUR 292,500

A man has been sentenced to 15 months in prison, suspended, for embezzlement and fraudulent insolvency involving the proceeds from four vehicle sales, mbl.is reported. His wife was acquitted, while a company was fined 36 million krónur for money laundering and fraudulent insolvency. The judgment was issued on November 6.

The company, Glitvangur ehf., must pay 18 million krónur within four weeks of the judgment’s publication. The other half of the fine is suspended for two years.

The man arranged the sale in Iceland of four Mercedes-Benz Sprinter vehicles belonging to the Polish Mercus companies through Daxson ehf., which was later renamed D-Son import ehf. and entered bankruptcy proceedings. He was convicted of embezzling proceeds totalling EUR 292,500 that he was required to return to the Polish companies. Instead, he used the money for himself and others, including Daxson and Glitvangur.

In January 2019, 18 million krónur was transferred from Daxson to Glitvangur. The man also received 11.12 million krónur from his wife after one of the vehicles, registered in her name, was sold.

The man argued that he or Daxson had bought the vehicles from the Mercus companies and resold them in Iceland, making the dispute a civil matter. He also said he had counterclaims relating to discounts, services and spare parts. The court found his account of the purchases unconvincing and inconsistent with the investigation evidence. It concluded that he had acted as an intermediary and was required to return the sale proceeds.

The court said that even if the man or Daxson had counterclaims, he could not use the proceeds to settle disputed, unapproved debts without an agreement with the Polish companies.

Glitvangur was convicted of money laundering for receiving and using the 18 million krónur payment from Daxson. The company’s records described the payment as covering a facilities charge, a share of the cost of building a car park and two years of facilities charges in advance. The court found the arrangement to be a sham, noting that Glitvangur’s 2019 and 2020 annual accounts recorded neither rental income nor outstanding rent claims against Daxson, and that there was no written lease. Of the payment, 17.7 million krónur was used to pay a debt on Glitvangur’s property loan.

The man and Glitvangur were also convicted of fraudulent insolvency in connection with the registration of a 150 million króna security instrument against a Glitvangur property in 2021. A case seeking to reverse the 18 million krónur payment had been filed against the company, and the security instrument was issued on the day that case was brought before the court.

The man’s wife had faced charges of money laundering and fraudulent insolvency but was acquitted of all charges.