Throwing another match on to the Dalli conspiracy bonfire....

Over the weekend, the Maltese government nominated its candidate for European commissioner. Tonio Borg is now in line to replace John Dalli, whose resignation last week was triggered by the results of an investigation by OLAF, the European Union's anti-fraud office. Those who have been following this drama (the resignation of a European commissioner on the grounds of alleged impropriety is unprecedented) will know that OLAF was responding to a complaint by Swedish Match, which among other things is a producer of oral tobacco, or snus. The company complained that it had been approached by a lobbyist, boasting of his connections with Dalli, who offered to shape the forthcoming tobacco products directive in ways favourable to snus.

My colleague Dave Keating has been reporting on various aspects of the Dalli drama – including the break-ins at offices of anti-tobacco campaign groups – on his blog.

I venture back into the territory myself only to point out a historical curiosity about Swedish Match, the company caught up in the Dalli affair. It was drawn to my attention by Stewart Fleming, who writes a fortnightly column for us. He is a veteran financial reporter and his track record includes being the US editor of the Financial Times. Nevertheless he denies having witnessed at first-hand the events that I am about to relate.

Swedish Match has its origins in two companies - Svenska Tobaksmonopolet (founded in 1915) and Svenska Tändsticks (the two companies merged as recently as 1992). Svenska Tändsticks was founded in 1917 by Ivar Kreuger, and he built the company up to be the biggest match company in the world, with monopolies as a supplier of matches. He acquired his monopolies as part of his conditions for making financial loans to governments. The scale of those loans made him the European bail-out fund of his day (those were the days when even the Germans struggled to get private investors to take on government debt) except that he was not constrained to loaning only to European countries and was bailing out Latin American countries as well. But Kreuger was lying about his assets and profits. In 1932, he was found dead in a Paris hotel room, apparently having shot himself. The empire, which was already tottering, came crashing down and caused such collateral damage that in Sweden and the US there was a discernible “Kreuger crash”.

Some allege that Svenska Tändsticks was a massive Ponzi scheme, that Kreuger was following the model of Charles Ponzi, paying investors returns from their own money or that of other investors. That version is disputed by those who say that Kreuger's schemes do not match the Ponzi form. What is not disputed is that there was financial wrongdoing at the heart of one of Swedish Match's forebears.

Anti-tobacco campaigners are constructing conspiracy theories – so far unproven - to argue that Dalli was brought down by the evil forces of the tobacco industry. They do not need any assistance from me, and I am not accusing the latter-day Swedish Match of any financial impropriety. Nonetheless I find it amusing that the 1930s antecedent of the company that has now brought down a European commissioner is a kind of corporate embodiment of everything that the European Commission would disapprove of: a monopoly supplier of products for smoking that went belly-up because of some form of fraud.