Former Skandia chief executive Lars-Erik Petersson has been jailed for two years for his part in Sweden's biggest corporate scandal in decades.

Mr Petersson was found guilty of a breach of trust for removing limits on an executive bonus scheme at the financial services firm, awarding SEK156 million ($21.5 million) in bonuses to managers without permission of the board.

An investigation into the scandal in 2003 found that the actions of some senior managers had been unsuitable, unethical and in some cases probably illegal. Mr Petersson and the rest of the company’s top management were sacked when the scandal broke.

The bonus scheme outraged Sweden, which heavily taxes its highest earners. Skandia was bought in a hostile takeover earlier this year by South Africa’s Old Mutual.