Iceland Goes to Polls Amid Scandals, Disgust and Distrust

If the environmentalist Left Greens triumph, Ms. Jakobsdottir would be the fourth prime minister in less than two years.

In this crowded mix, a dark horse has appeared: the former Prime Minister Sigmundur David Gunnlaugsson. He was driven from office in April 2016 when he became the first major casualty of the leaked Panama Papers. They revealed that he and his wife had set up a company in the British Virgin Islands.

Mr. Gunnlaugsson had come to power on promises to clear out corruption. But the Panama Papers leak, though it revealed nothing illegal, suggested an unseemly conflict of interest, and an outraged public called for his ouster.

For days, Icelanders gathered outside Parliament and hurled fish and yogurt in protest. He eventually stepped down, prompting snap elections. It seemed as if he would never lead his country again.

But Mr. Gunnlaugsson is back. He ditched his old party, the Progressives, and formed the Center Party, a populist outfit promising to squeeze the financial sector and redistribute the wealth.

He has campaigned under the banner of an Icelandic horse, gaining surprising momentum. His charisma, his threats to take news media outlets to court for supposed unfair treatment and his promises to wrest wealth from Iceland’s banks have resonated in his largely rural base.

Reykjavik, Iceland’s capital. The country has clawed its way out of the financial collapse of 2008, but voter distrust is high.

Spencer Platt/Getty Images

“He has talked his way out of the scandal,” said Johannes Kr. Kristjansson, the Reykjavik Media editor who revealed Mr. Gunnlaugsson’s family ties to the Panama Papers. “You can compare him to Donald Trump. He has a group of people who will elect him no matter what he says or does.”

In one fiery debate, Mr. Gunnlaugsson stormed offstage, refusing to shake his rivals� hands. As prime minister, he showed an eccentric flair, inviting counterparts to play with Legos and once meeting Barack Obama in one polished shoe and one sneaker.

Mr. Gunnlaugsson declined multiple requests for an interview, but he has been adamant that he did no wrong. In fact, he claims he is a victim of a conspiracy initiated by Iceland’s political and financial establishment in cahoots with the financier George Soros.

An outright victory for Mr. Gunnlaugsson remains unlikely. He’s hoping his party does well enough to become part of the governing coalition, political observers say. But he’s no kingmaker.

Some experts say that it will take a rickety coalition of as many as four parties to form a new government. If the Left Greens win, Mr. Gunnlaugsson would be an unlikely coalition partner. They appear to be more open to teaming with a revived Social Democrat Party and, potentially, the Pirate Party � a nerdy group of futurists, hackers, anarchists and poets.

The anti-establishment Pirates capitalized on the anger over corruption and Mr. Gunnlaugsson’s ouster to take second place in snap general elections last October. But they also drove his successor, Sigurdur Ingi Johannsson, to quit as prime minister after his center-right Progressive Party’s share of Parliament shrunk to eight seats from 19.

Among the notable parties in the current race is Bright Future, known as a group of idealistic hipsters who say they shun the idea of becoming career politicians. The party is on course to lose most, if not all, of its seats, polls suggest, after helping to precipitate one of the pivotal twists in Icelandic politics.

The vote, the second snap election in a year, turns on an episode involving Prime Minister Bjarni Benediktsson. Mr. Benediktsson’s father had written a letter of reference for a friend seeking a form of civil pardon after being sentenced in 2004 to prison on charges of raping his stepdaughter for over 12 years.

The Justice Ministry covered up the letter, critics say, but the secret found its way to the news media. It was the final straw for one of the coalition partners, Bright Future, which peeled away and brought down the government.

In September, eight months after Mr. Benediktsson’s administration came to power, he called for new elections, lamenting, “We have lost the majority.”

But another scandal landed just as the campaign got underway, salting the nation’s old financial wounds. Journalists released some of Mr. Benediktsson’s personal financial records from the days before the banking collapse.

They showed no legal wrongdoing, but raised disturbing questions. Mr. Benediktsson, then a member of Parliament, had managed to snatch his money out of harm’s way � just before the crash brought Iceland to its knees.

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