The government investigator charged with examining the collapse of the three Icelandic banks, Ólafur Þór Hauksson, has confirmed that 22 policemen and six French and Norwegian accountants have raided the offices of KPMG and PricewaterhouseCoopers (PwC) in Reykjavik, seizing documents and computer data as part of an investigation into alleged criminal activity.

Although the targets are the accountants' banking clients Kaupthing, Glitnir and Landsbanki and not the accountants themselves, the raids will be an embarrassment for the firms involved. As with most accountancy practices, the Reykjavik branches of KPMG and PwC are owned by its partners, but they are also part of the multinational network of firms.

According to local reports, the teams were looking for evidence relating to violation of laws on: accounting and annual reports;  financial institutions and securities transactions; on public limited companies.

The UK's Serious Fraud office is assisting the Icelandic prosecutor with the on-going investigations.

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