It should be remembered that in the early part of the 20th century matches were a necessity for smoking and the lighting of stoves and gas appliances among other uses and therefore demand for them was highly , meaning that a monopolist could raise prices and hence profits significantly without much affecting the quantity sold. Kreuger-mordet: en utredning med nya fakta in Swedish New ed.

Retrieved 14 August 2017. These bills were largely successful in their mission and the American financial industry did not witness frauds of the same magnitude until the scandal and 's. At times it seemed that he was a solid, if ruthless, businessman, and at other times he appeared every inch a scam artist.

- Volvo acquired part of Procordia in 1990 and became the principal owner together with the Swedish government.

For the 1932 film about Kreuger, see. Ivar Kreuger Swedish: ; 2 March 1880 — 12 March 1932 was a Swedish civil engineer, financier, entrepreneur and industrialist. In 1908, he co-founded the construction company , which specialized in new building techniques. By aggressive investments and innovative financial instruments, he built a global and financial empire. Ivar Kreuger Ivar Kreuger c. However, in a Ponzi scheme early investors are paid from their own money or that of subsequent investors. Although Kreuger did this to some extent, he also controlled many legitimate and often very profitable businesses, and owned banks, real estate, a gold mine, and and industrial companies, besides his many match companies. Many of them have survived to this day. Kreuger's financial empire collapsed during the. The police concluded that he had committed suicide, but decades later, his brother Torsten claimed that he had been murdered, which spawned some controversial literature on the subject. Kreuger as a graduate at the age of 16. Kreuger was born in , the eldest son of Ernst August Kreuger 1852—1946 , an industrialist in the match industry in that city, and his wife Jenny Emelie Kreuger née Forssman; 1856—1949. Ivar Kreuger had five siblings: Ingrid born 1877 , Helga born 1878 , Torsten born 1884 , Greta born 1889 and Britta born 1891. At school, Ivar skipped ahead two classes by taking private lessons. At age 16, he began studies at the in , from which he graduated with combined master's degrees covering both the faculties of and civil engineering, at the age of 20. Ivar Kreuger never married, but lived for many years in different periods with Ingeborg Eberth 1889—1977 , family name Hässler, born in Stockholm, who worked as a in Stockholm. They met for the first time in Stockholm in 1913. According to the book she wrote in 1932, after Krueger's death, he was not interested in marriage or children, and was very much focused on his business. She broke off the relationship in 1917 and moved to Denmark, where she married a Danish engineer with the name Eberth. They had a daughter in 1919, Grete Eberth later to be an actress in Stockholm, married name Mac Laury 1919—2002. After some years, however, she divorced Eberth and moved back to Stockholm with her daughter, reuniting with Kreuger. Eberth once kidnapped the daughter in Stockholm and brought her back to Denmark. Shortly thereafter Ingeborg, without notifying the authorities or police, went down to Denmark and brought the daughter back to Sweden by hiring a private fishing boat in Denmark that took them over to Sweden. The new period with Kreuger lasted until around 1928; after that they just met occasionally. The last time they met was in November 1931, just before Kreuger started on his final trip to America. Eberth received the news about his death in Paris on March 12, 1932, from newspaper headlines the day after. Kreuger had private apartments in Stockholm, New York, Paris, and , and a country place used during the summer season on the private island Ängsholmen in the archipelago of Stockholm. On business tours in Europe, he preferred to meet his business associates in Paris and then stayed in his flat at 5, Av. Victor Emanuel III today named Avenue Franklin D. He owned several specially designed , among them Elsa built in 1906, Loris 1913 , Tärnan 1925 , and the most famous, Svalan Swallow , built at in 1928, a 37 ft, 4. A replica of the boat has been built. He had a large private library in both his apartments in Stockholm and New York and quite a large art collection. The paintings were sold at different auctions held in September 1932, as all of Kreuger's private assets were incorporated into the bankruptcy. The collection in Stockholm comprised 88 original paintings, among them 19 by and a great number by from the Netherlands. The New York collection included original paintings by and. Kreuger became the major shareholder when the Swedish film company SF was founded in 1919 and because of that, sometimes met celebrities from the film industry. In June 1924, and were invited by SF to Stockholm and were guided around the Stockholm archipelago in Kreuger's motor yacht Loris. A five-minute film sequence of this occasion is stored in SF's film archive. Pickford, Fairbanks, Kreuger, Charles Magnusson the manager for SF , and various SF employees appear in the film. After the start of the 20th century, Kreuger spent seven years traveling and working abroad as an engineer in the USA, Mexico, South Africa and other countries, but spent most of the time in the US. In South Africa, he ran a restaurant for a short time together with his friend , but they soon sold the restaurant. This new technique had not been introduced in Sweden at that time. In 1907, he managed to get the representative rights for the system for both the Swedish and the German markets, and at the end of 1907, he returned to Sweden with the goal of introducing the new methods in both countries at the same time. At that time, one of the experts in Sweden in concrete-steel constructions was his cousin working at in Stockholm. Note that multiplying historical U. To appreciate the enormous sums with which he was involved and to evaluate Ivar Kreuger, it is necessary to factor out inflation. This is done in the text by giving the approximate value in today's money in parentheses. Rather than showing the source used after every conversion into today's values it is provided in this section. In May 1908, Kreuger formed the construction firm in Sweden with the engineer , at that time working for the construction company Kasper Höglund AB, and his cousin , working at the faculty of civil engineering at , as a consulting engineer for the company. In Germany, he formed the company Deutsche Kahneisengesellschaft together with a colleague from his time in America, Anders Jordahl. The new way of constructing buildings was not fully accepted in Sweden at that time and in order to market the new technique, Kreuger held several lectures and wrote an illustrated article on the subject in a leading engineering magazine,. The chief engineer behind these advanced projects was Henrik Kreüger. Innovation in the construction business also included a definite commitment to finish the building on time. Hitherto the financial risk of delays were assumed by the clients. The client, in turn, agreed to pay a bonus for every day the building was finished before the due date. Ivar Kreuger was not among the board members in the construction company. How much of Paul Toll's company Ivar Kreuger owned has not been revealed—just that Paul Toll owned 60% in 1917 and, around 1930, 66% of the construction company. He controlled it with a tight grip. The board of directors consisted of Ivar, his father, Paul Toll and two very close colleagues. Thus, by 1927, Ivar had bought banks, mining companies, railways, timber and paper firms, film distributors, real estate in several European cities as well as a controlling stake in L. He controlled about 50% of the world market in iron ore and cellulose. He owned mines all over the world including the mine in Sweden, which had one of the richest gold deposits outside South Africa in addition to other minerals. Kreuger formed by merging his father's business with other match factories he had quietly bought during. The Swedish banker 1878—1951 became a close associate and an important teacher for Ivar in the financing business. For not having carried out his duties as a director he went to jail for 10 months after Ivar's death. Oscar Rydbeck, Ivar Kreuger's banker. In 1911 and 1912, the Kreuger family match factories in , and , run by his father Ernst Kreuger, uncle Fredrik Kreuger and his brother Torsten Kreuger, encountered financial problems. Kreuger was then advised by his banker Oscar Rydbeck to turn the factories into a stock corporation in order to raise more capital. This was the starting point for the reformation of the Swedish match industry as well as the major match companies in Norway and Finland. The goal was to get control of the entire match industry in Scandinavia. With the family match factories as the base, Kreuger first founded the Swedish corporation AB Kalmar-Mönsterås Tändsticksfabrik in 1912. His father, Ernst, and uncle Fredrik, became the major shareholders and his brother was appointed the general manager. Ivar became a member of the board. A merger between this company with several other small match companies in Sweden, the company AB Svenska Förenade Tändsticksfabriker was founded in 1913 with Ivar Kreuger as the general manager. Later, by merging with the largest match company in Sweden, AB Jönköping-Vulcan, Svenska Tändsticks AB was founded in 1917. Ivar had originally tried to convince AB Jönköping-Vulcan to merge in December 1912, but they had not been interested as Vulcan was the dominating match company in Sweden. Ivar then started to acquire all of the match companies as well as most of the raw material companies he could find in and around Sweden and then finally got AB Jönköping-Vulcan to accept the merger. He had been so persuasive in arguing for the merger that he managed to overvalue his side of the deal so that it was essentially the smaller organization taking over the larger one. It was his first big venture in inflating values, which became his prime tactic thereafter. One of the main designers behind this operation, beside Ivar, was his banker Rydbeck. The total number of shares in the new company was 450,000. This company group now covered the entire match industry in Sweden, including all the major companies that manufactured the production machines used in the factories. The total number of employees working in match production in Sweden in 1917 was around 9000. It also had control over major companies supplying the raw material for the match industry. During this time Kreuger also acquired the largest match manufacturing companies in Norway and and in Finland and. He managed to unite the Swedish match industry as well as the major match companies in Norway and Finland. With this new company structure the match industry in became a major competitor to large manufacturers elsewhere. Ivar's methods resembled those used in the formation of the transforming dozens of struggling factories into a strong and profitable monopoly. The methods had become illegal in the USA because of , but were not against the law in Sweden at the time. A German chemist had invented matches in 1832 but they were dangerous because the yellow phosphorus used was poisonous and because it was in the match head and thus could easily light by accident. The Swedes improved on the design by using a safer red phosphorus, which they put on the striking surface of the matchbox. They made Sweden the leading exporter of matches and made matches the most important Swedish export. It should be remembered that in the early part of the 20th century matches were a necessity for smoking and the lighting of stoves and gas appliances among other uses and therefore demand for them was highly , meaning that a monopolist could raise prices and hence profits significantly without much affecting the quantity sold. By expanding the Swedish Match company through acquisition of government-created monopolies, the Swedish company became the world's largest match manufacturer. This group eventually came to control almost 75% of the world production in matches. See also: From 1925 to 1930, years when many countries in Europe were suffering after the , Kreuger's companies gave loans to governments to speed up reconstruction. As a security, the governments would grant him the match monopoly in their country. This means that Kreuger gained a monopoly in match production, sales, or distribution, or a complete monopoly. The monopoly agreements differed from country to country. The capital was raised to a large extent through loans from Swedish and American banks, combined with issuing a large amount of participating debentures. Kreuger also often moved money from one corporation he controlled to another. Kreuger did not limit himself to matches, but gained control of most of the industry in northern Sweden and planned to become head of a. He also attempted to create a telephone monopoly in Sweden. After founding the pulp manufacturer , in 1929 Kreuger was able to acquire the majority shares in the telephone company ; the mining company gold ; major interests in the manufacturer ; the bank and others. Abroad he acquired in Germany and in France, often with the acquired company's own money. By 1931, Kreuger controlled some 200 companies. However, the turned out to be a major factor in exposing his accounting that ultimately proved fatal to both him and his empire. He was invited by President to the to discuss the subject and in June he was awarded the title of by , where he had worked as a young chief engineer when was built there in 1907. Such schemes had been around for a long time e. B-shares Kreuger financed his activities by selling shares and bonds of his companies as well as through large bank loans, mainly the last two. The use of debt in addition to equity is called leverage and it magnifies both gains and losses. With respect to selling shares, he invented dual class ownership shares since he did not want to lose control of his companies. He called the class of shares with reduced B shares. Ivar began with Swedish Match where he divided the common shares into two classes. In this way Ivar could double the size of his capital, while diluting his control by just a fraction of a percent. Presently such shares are sometimes called A Shares with the B Shares having more voting power, as is the case with Google for instance where they carry ten times more voting power than the A Shares. The New York Stock Exchange, for example, allows companies to list dual-class voting shares. Once shares are listed, however, companies are not allowed to reduce the voting rights of the existing shares or issue a new class of superior voting shares. There is a wide range of dual-class share structures and their use between countries. In Canada, for example, an estimated 20% to 25% of companies currently listed on the TSX make use of some form of dual-class share structure or special voting rights. In the United States on the other hand, where rules on dual-class shares are much more restrictive and investor opposition is more vocal, just over 2% of companies issue restricted shares. They were issued to mature in 20 years and they were payable in either dollars or gold, at the holder's option. These bonds gave investors the right to receive annual interest payments of 6. Finally, these debentures were convertible, which meant that they could be converted into shares. If International Match performed well and the value of the shares increased, investors could switch from the debentures to the more valuable shares. The convertible feature made these securities particularly attractive: they have both downside protection because in the case of bankruptcy the bond holders were paid before the shareholders and upside potential. In other words, the best of both worlds. American Certificates Kreuger invented another financial instrument, which continues to be used and is nowadays known as. American investors had never seen an investment like this. It was part bond, part preferred stock, and part profit sharing option. The certificates enabled investors to gain exposure to a foreign company that had been paying dividends of 25 percent. It would be backed by the largest private loan to a foreign government i. Even in the midst of the growing panic investors went crazy for the issue and promised to buy 28 million dollars of the new securities. And this happened two days after in 1929. This option term secured both initial control over Garanta and the right to own a majority of Garanta's shares in the future. Off balance sheet entities This means that details of an enterprise do not appear in the parent company's financial statements. Some of these entities were more or less secret. Where less than such a majority is owned, the shares are included as investments. The former issued 250 million dollars' worth of complex securities equivalent to about 3. Lehman issued similar obligations, which immediately rose 30 percent. Despite the large number of companies Ivar controlled, he was an avid gambler. He speculated with his personal funds and, especially, with the money of the corporations he controlled. Kreuger treated most of his companies as if they were exclusively his personal property. He frequently transferred funds from one corporation to another with little formality. A number of dummy corporations and holding companies e. Garanta and Continental Investment Corporation helped him to hide what he was doing. He also used other people as front men to conceal his actions, for example when he acquired almost half of the outstanding shares of so as not to raise concerns in the USA. Towards the end, in 1932, when he frantically gambled with the securities of corporations he controlled in the vain attempt to reverse their falling prices, he played the markets himself and had friends help him in the effort to prop up share prices. His speculations were in foreign currencies, equities and derivatives and he also signed loan agreements with governments not knowing where the funds would be coming from. For example, the majority stake he had bought in a chemical company in , Germany returned 15 times his investment after two years when the company became part of. Therefore, he also had to make sure that he had money to pay those dividends. His first sovereign loan went to Poland and when Kreuger signed the agreement he had no idea where the funds would come from. He already controlled 70% of German match production before the loan agreement. When he signed the contract, he had no idea where he would obtain the huge amount; however, he was lucky. Incredibly, the French agreed to pay this sum by April 1930, just before Ivar's first payment to Germany was due. That payment gave Ivar enough cash to make his first installment. Either he had negotiated a sweetheart rescue deal with Prime Minister Briand, or he was incredibly lucky. It should be kept in mind that Kreuger controlled around 400 companies, therefore the following list is highly selective. Notable exceptions include , of which he owned almost half the outstanding shares, Ohio Match Company and. Holding company for countries outside Europe. Main interests in Stockholm City. Founded by Ivar Kreuger 1915. In March 1931, during a meeting at the German Ministry of Finance in Berlin, Swiss banker already warned of a bankruptcy of Kreuger's match company. In February 1932, Kreuger turned to for the second time in his life to support him in raising a large increase in his loans. At this time his total loans from Swedish banks were estimated at about half of the Swedish reserve currency, which had started to have negative effects on the value of the Swedish currency in the international financial market. At that time, Ivar Kreuger was in the United States and was asked to return to Europe for a meeting with the chairman of the Riksbank,. He had left Sweden for the last time on 23 November 1931 and returned to Europe on the ship arriving in Paris on 11 March 1932. The meeting with Ivar Rooth was scheduled to take place on 13 or 14 March in. But the day after he was found dead in bed in his apartment at Avenue Victor Emanuel III. After questioning Kreuger's servants his French maid, Mademoiselle Barrault, and the who had had contact with Kreuger in the morning the French police and a physician came to the conclusion that he had shot himself some time between 10:45 a. A 9-mm semi-automatic gun was found on the bed beside the body. He left a sealed envelope in the room, addressed to Krister Littorin, which contained three other sealed envelopes - one addressed to his sister Britta; one to Sune Schéle; and one addressed to Littorin. In the letter to Littorin for some reason written in English although Littorin was his closest Swedish colleague , he wrote: I have made such a mess of things that I believe this to be the most satisfactory solution for everybody concerned. Please, take care of these two letters also see that two letters which were sent a couple of days ago by Jordahl to me at 5, Avenue Victor Emanuel are returned to Jordahl. The letters were sent by - Goodbye now and thanks. Ivar Kreuger was interred in in Stockholm. Kreuger's death precipitated the Kreuger Crash which hit investors and companies worldwide, but particularly hard in the USA and Sweden. In 1933 and 1934, the U. Congress passed several security reform legislations that were meant to prevent a repeat of the Kreuger Crash. These bills were largely successful in their mission and the American financial industry did not witness frauds of the same magnitude until the scandal and 's. Prior to the crash, Kreuger had issued thousands of participating. Following the Kreuger crash, both the debentures and shares became worthless, and several thousand Swedes and small banks lost their savings and investments as a result. Large investors and suppliers apart from share holders, received a total of 43% back. The banks related to the company group, company group, and took over most of the companies in the Kreuger empire. Swedish Match recovered shortly after the crash as did most of the industrial companies within the Kreuger empire. Swedish Match received a large government guaranteed loan that was fully repaid after several years. IMCO in USA however did not survive. The liquidation took nine years and was eventually finished in 1941. One biographer called him a genius and swindler. He was the Leonardo of their craft. At times it seemed that he was a solid, if ruthless, businessman, and at other times he appeared every inch a scam artist. Between those times, he either built a match monopoly that overreached or orchestrated one of the biggest pyramid schemes in history. It's obvious that it's impossible to have earnings in single digits as these sovereign loans typically paid and continue paying dividends in double digits. Dividends were as high as 20%. However, while paying high dividends was definitely one of the attractions of Kreuger's companies, paying dividends to his investors did not come exclusively from new investors, which is the case in Ponzi schemes. Balance sheets and Profit and Loss statements served one major purpose, if not the only one, for Ivar and that was they had to be helpful in his fund raising efforts. Often they were just pure fantasy to be revised at will to please investors. He also frequently treated the assets of corporations he controlled as if they were his own. However, things should be seen in the context of the time. Many companies set up arbitrary reserves in good times to be used in bad years and few holding companies published consolidated. Accounting standards and auditors' responsibility for the accuracy of financial statements evolved over time. Corporations resisted publishing audited financial statements. It was not until the US Securities Acts' of and —both heavily influenced by Kreuger's actions—that generally accepted accounting principles GAAP began to be established. Only in the 1970s and 1980s were auditors forced to accept more responsibility for the veracity of financial statements but loopholes continued to exist and probably still do. Dishonesty was part of Ivar's behaviour almost from the beginning of his career. In the first loan for a match monopoly, Ivar's brother Torsten negotiated with Dr. Marjam Glowacki, a senior Polish finance ministry official. After the documents were signed Ivar decided that it might be useful in the future to replicate Dr. He ordered a rubber stamp that would produce a facsimile should he need it in the future. He did not use it; however, from then on he had rubber stamps made of official signatures of almost all his match deals. A lithographer who had printed share certificates for Ivar made 42 Italian bills, which Ivar signed with the names of G. Boselli an official in the Ministry of Finance and A. Mosconi, the Minister of Finance. It has never been explained why these forgeries were so crude. He even misspelled Boselli's name several times. Ivar kept them in his safe for almost two years. They would have been worth between c. Yet it would be a mistake to conclude that Ivar was nothing but a crook. Reality was more nuanced. For one thing disclosure rules in his days were much less stringent. Many corporations refused to reveal details for fear competitors would gain an advantage. At least that was the claim often made. Some firms did not even publish quarterly results. Ivar, too, was very secretive and not only with investors. Without the hunger for ever larger profits many of Ivar's schemes would not have been possible. Incidentally this facilitated a transfer of capital from the USA to Europe where it was, often desperately, needed. He sold shares in the USA worth 250 million dollars equivalent to c. Shareholders of International Match had given him authority to do this so there was nothing wrong with it. There was also a tax advantage because of the advantageous deal he had negotiated with Liechtenstein. But Ivar did it above all to have the flexibility to manipulate balance sheets and financial statements so they would look more attractive to investors as well as helping him — to some extent - pay the high dividends of Swedish Match and. He invented new financial instruments to help him raise funds and, of course, make him money. Indeed, many consider Ivar to be the father of modern financial schemes. Oscar Rydbeck, his Swedish banker, said Ivar was the third richest man in the world. Ivar was also a successful speculator for much of his life making lots of money until shortly before the end. Trying to support the collapsing share prices of many of his companies including ways which were—if not illegal—questionable, e. In the case of his acquisition of shares it was clearly illegal because of anti-trust laws. He controlled many legitimate, profitable businesses, some of which still exist to this day. Examples include , , , - Europe's largest gold mine -, and. Some of the shrinkage was due to depressed prices but much went into paying dividends from capital over the years. Principal Kreuger company is Swedish Match — Svenska Tändsticks. It makes 66% of the world's matches, controlling 250 plants in 43 nations. This company's growth was due to Ivar Kreuger's efforts and its rise paralleled his own. New York; 1960, p. Morris, A Rabble of Dead Money: The Great Crash and the Global Depression: 1929-1939 2017 , p 167. New York; 1960 p. New York; 1960 p. New York; 1960 p. This Time Is Different, Princeton University Press, Princeton and Oxford, c. New York; 1960 p. New York; 1960 p. Ivar Kreuger in Swedish. The Young-loan was designed to split up the loan on a large number of countries, in order to secure that Germany paid the from. Between 1925—1930 Schéle was a manager for the Kreuger business in India. Ivar Kreuger was the world's greatest swindler. He would have thrived today. Kreuger walked to a gun-shop and bought a 9mm automatic pistol. That night, the man who had never married, who kissed women on the wrist rather than the hand for fear of germs, had a last tryst with a young Finnish girlfriend. The next day, lying on his bed in a pin-stripe suit, he shot himself, blowing out the last flicker of illusion in a hopeless age. New York; 1960, p. New York; 1960, p. Clikeman, Routledge, 2008 p. Clikeman, Routledge, 2008 pp. Called to Account: Fourteen Financial Frauds that Shaped the American Accounting Profession, Routledge, 2008 by Paul M. Clikeman, Routledge, 2008 p. New York; 1960, p. New York; 1960, p. New York; 1960, p. Clikeman Routledge, 2008 , p. Meaker: Sudden Endings, 13 Profiles in Depth of famous Suicides Doubleday, Garden City, NY, 1964 , pp. Published by Samtid och Framtid AB, Stockholm 1965. Ivar Kreuger: the match king. Translated by Thiel, George. The book Kreuger by Poul Carl Bjerre 1876—1964 , covers the Kreuger family heritage from 1710, Ivar Kreugers childhood and the time until he returned to Sweden, around Christmas time 1907. A number of letters are published in the book. Published by Samtid och framtid AB, Stockholm 1966. Därför mördades Ivar Kreuger in Swedish. Oscar Rydbeck och hans tid in Swedish. Ivar Kreuger in Swedish. Kreuger-mordet: en utredning med nya fakta in Swedish New ed. Piteå: Tendens i Sverige AB.

He controlled about 50% of the world market in iron ore and cellulose. The companies had an ownership of 50 percent each in SMPM International. Some firms did not even publish quarterly results. Sweden match of these jesus were more or less secret. Oscar Rydbeck och hans tid in Swedish. But Ivar did it above all to have the flexibility to manipulate balance sheets and financial statements so they would look more attractive to investors as well as helping him — to some north - pay the high dividends of Swedish Match and. However, sweden match a Ponzi scheme early investors are paid from their own money or that of subsequent investors. How much of Paul Toll's company Ivar Kreuger owned has not been revealed—just that Paul Toll owned 60% in 1917 and, around 1930, 66% of the con company. Hitherto the financial risk of delays were assumed by the clients.