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FINANCIAL

Fraud trial captivates local Swedish community

Disgruntled savers from a small Swedish community flooded into a Jönköping court on Thursday to follow the case of Habo Finans, an investment firm which folded taking the savings of almost 780 people with it.

Fraud trial captivates local Swedish community
Habo Finans CEO Peter Rosendahl arrives at Jönkoping district court on Thursday

Launched in 1995 by former welder Peter Rosendahl, Habo Finans later ran into difficulties in 2006 before filing for bankruptcy in 2008. Rosendahl now faces charges of serious fraud and serious accounting fraud, while the remaining five board members are accused of serious accounting fraud.

The case has attracted a great deal of interest in the small Swedish community of Habo, which was voted the “best place to live in Sweden” by Fokus magazine in 2010, as many local residents had invested with Rosendahl and Habo Finans in the hope of high returns.

A total of 780 savers are claiming 90 million kronor ($13.4 million) from the bankrupt firm, which is reported to have only 30 million kronor in assets.

Many of the savers had invested their life savings in the firm, which was shown to lack sufficient bank guarantees, or a licence from the Financial Supervisory Authority (Finansinspektionen – FI) to conduct trading in shares.

“I invested because acquaintances had done so and had earned dividends of 25-30 percent,” said local Habo resident Bernt Olof Berntsson.

“Unfortunately it was at the cost of the later savers that they made money.”

Shortly after the firm ran into difficulties, Peter Rosendahl turned himself in to Gothenburg police. Since the bankruptcy, Rosendahl has been in hiding from the former friends, neighbours and clients who had trusted his judgement on the stock market.

Until he was was tracked down recently by TV4’s Kalla Fakta investigative news programme.

”The worst is when I go to bed at night, I can’t relax. But that is something I will have to live with it for the rest of my life,” Rosendahl told TV4.

“It doesn’t help the customers affected, but it is a way to work through it. I go through the client list again and again.”

Rosendahl was working as a welder in a local Habo company in the 1990s when he developed a name for himself as something of a successful amateur share trader and decided in the mid-1990s to start a financial services firm.

”Despite the fact that I was just an ordinary metalworker, the men from the office, and everybody started to talk shares with me. It was a nice time,” he said.

Habo Finans was set up with the initial intention to invest in Ericsson stock, Rosendahl said, and within a year the firm had proven popular with local residents.

”When I arrived in the morning, and people stood queuing, when I looked at the diary there were so many customers who wanted to become new investors, it was not so easy to put a stop to it,” he said, reflecting on the firm’s rapid growth.

Another local investor Roger Moll told TV4 that for several years everyone in the community was talking about the firm.

“A lot of friends recommended it – it was not quite a sect, but it was very big,” he told TV4.

But when some more risky investments turned sour, and clients began to withdraw their savings, the firm used new client funds to fill the hole in the accounts, ultimately forcing the firm’s closure.

Bernt Olof Berntsson heads a group of investors who, aside from their demands on the bankrupted firm, are claiming damages from Habo Finans’s accountants, who they claim had not fulfilled their obligations.

The case is one of the largest of its kind in Swedish history and 18 investors are scheduled to testify in the month-long trial in Jönköping District Court. Interest in the trial is so great that the court has hired a nearby cinema in order to broadcast the proceedings live.

If convicted, Peter Rosendahl is facing a prison sentence of up to 12 years, but told TV4 that he welcomes the trial in order to clear the air.

”It can’t be any worse than it is now. To live in secret, to hardly be able to go out during the day…” he said.

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ENERGY

What rules are there for wood burners and fireplaces in Sweden?

With the price of electricity and heating going up, many people in Sweden have turned to wood burners and fireplaces to help heat their homes and lower their heating costs. What rules do you have to bear in mind?

What rules are there for wood burners and fireplaces in Sweden?

What fuel can I use?

As a general rule, you should only burn dry wood. Guidelines from the Swedish Environmental Protection Agency state that your wood must have dried for at least 6 months, in a covered outdoor location.

Once you’ve brought it inside, try to use it within two weeks – otherwise it can dry out too much, meaning it burns more quickly, produces less heat and more soot.

On the other hand, if your wood is too wet, this can also cause issues. It will produce a lot of smoke, will not burn well and will emit a larger amount of environmentally hazardous substances.

It is illegal to burn rubbish such as milk cartons or plastic, as well as impregnated or painted wood, chipboard and plywood.

Coal is rarely used for heating private homes in Sweden due to the environmental impact, although there are no official bans on burning coal in indoor fireplaces.

Keep in mind that many modern fireplaces or wood burners are not designed for burning coal, and older fireplaces may only be approved for burning wood, so make sure you check the recommendations for your heater if you plan on using coal.

On the topic of older fireplaces, make sure you check with your council or building owner whether you are permitted to use your fireplace before you light a fire. If it hasn’t been used for a number of years, you may need to schedule an inspection, where an expert will inspect your fireplace and chimney for any cracks or areas that need repairing.

When can I light a fire?

Depending on where you live, there may be rules on when you are allowed to light a fire if it is not your primary source of heating. This is usually referred to as trivseleldning – lighting a fire for cosiness or comfort, rather than necessity.

In Malmö, for example, you are only allowed to light fires in tiled chimneys (kakelugnar), open fireplaces or woodburners between October 1st and March 31st. Some municipalities – Malmö included – also recommend lighting a fire no more than twice a week, for a maximum of four hours at a time.

Anna Nordkvist, a chimneysweep in Västerås, prepares to swing a chimney brush into a chimney. Photo: Per Groth/TT/Scanpix

Stockholm and Gothenburg have no rules on what time of year you are allowed to light a fire, or how often, but all three city councils underline the importance of considering your neighbours and only lighting a fire on days where it is windy enough for the smoke produced to be sufficiently dispersed.

If you live in another area, try searching for elda inomhus, plus the name of your local municipality, to find out the rules where you live.

If you burn wood in a way that causes irritation to your neighbours, they have the right to complain to the local council’s environmental department, who have the power to issue you with a ban on using your fireplace.

How often should I clean my chimney?

Depending on whether you live in a house or apartment, you may be responsible for organising chimney-sweeping yourself, or this might be the responsibility of the owner of your building.

Usually, if your fireplace or wood burner is not your primary source of heating and you only use it occasionally, your chimney won’t need to be swept more than once every three years.

If you’re not sure when your chimney was last swept (either because you don’t use it very often or because you recently moved into your property), try contacting your local council or searching for sotare (chimney sweep) or sotning (chimney-sweeping), plus the area where you live for advice. Most councils have a list over the properties in their area with chimneys and when they were last cleaned, or they will refer you to their approved contractors who should be able to help you.

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