Icelandic government set to sue UK authorities
It has today been revealed that the Icelandic government has every intention of suing the UK authorities over the seizure of the assets of two of its biggest banks which operated in the UK. The move is set to reignite what has been a very difficult period for both the Icelandic authorities and the UK government and prompt a flurry of difficult questions. The UK government has already agreed to lend the Icelandic authorities enough money to repay UK depositors who lost out when the banking system in Iceland collapsed.
This move by the Icelandic government would seem to put this agreement in jeopardy and could cause problems for UK depositors claiming back money which had been frozen. At the time of the banking crisis in Iceland there were accusations that the UK government issued a number of inaccurate public statements which the Icelandic government believe prompted the final collapse in their currency and their banking system.
While the UK authorities have always denied playing any role in the collapse of the Icelandic banking system there will no doubt be a number of difficult questions to be answered amid claims that the loan to Iceland was part of a deal to avoid such a situation as that prompted by the Icelandic government.
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