My Letter to TSC Committee (Hearings on the 17th and 19th March)

Posted 15/03/2009 - 07:33 by tonycBrisbaneOz

Dear Sir,

On the 8th of October the Chancellor made the statement that “The Icelandic government believe it or not, have told me yesterday they have no intention of honouring their obligations here.” The Icelandic government have denied this, and in the transcript of Mr Darling's conversation with Árni Mathiesen, the Icelandic Finance Minister, this lack of intent is not discussed. The Finance Minister does admit they have difficulties. If one excludes a barefaced lie then the only explanation I can only come up is a gross misinterpretation of the conversation with the Icelandic Finance Minister. I'd be interested in Mr Darling's explanation as it was this statement and the seizure of Kaupthing Singer Friedlander UK that lead to the collapse of a KSF Isle of Man. A Freedom of Information (1) request finds the Treasury unable to supply either a document or transcript of a conversation where Mr Darling's assertion is made.

I have also written to the Department of Justice on the 25th January regarding the apparent conflict between Statutory Instrument 2008 2674 and part II, First Protocol, Article 1, (protection of property), of the 1998 UK human rights act. They have so far failed to answer my query within the 20 working days they boast about on their website.

Even though HMG has been trying to distance itself from the problems it has caused on the Isle Of Man it is still a Crown Dependency in the British Isles and is perceived as to be part of the UK. As of the 31st of December there were nearly 70billion pounds worth of deposits on the IOM of which 44 billion pounds is in Sterling. Wouldn't the the erosion of confidence in the IOM further reduce confidence in UK banking system? Surely it's in the interest of HMG to ensure that confidence in the IOM banking system is maintained. Many British banks operate on the IOM, including those that have been nationalised or otherwise rescued would they need to be bailed out again if the banking industry on the IOM collapsed?

The Isle of Man government have so far proved to be totally unable or unwilling to ensure depositors in KSF IOM speedily receive 100% of what's owed to them unlike anywhere else in Europe. The next liquidation hearing is on the 9th of April, a full six months after the collapse of KSF IOM.

In a recent letter from Paul Myners I get the impression that the treasury seems to think I am to blame for placing my savings in a licenced bank but I have no control over the FSC (IOM Financial Service Commission). The Isle of Man branch of KSF placed a deposit in a licenced bank in the UK, presumably in good faith, just as thousands of UK depositors had. If those all depositors had ranked like depositors in the IOM branch then they would still be waiting for the return of their deposits, just like me and thousands of other depositors in KSF IOM. To suggest that all depositors in KSF UK have been treated equally is nonsense. I note that customers with Kaupthing Edge now have access to their funds. I understand that the catastrophic decision to upstream money from KSF IOM to KSF UK was a result of collusion IOM Financial Supervision Commission and the FSA. The FSA has now been revealed as a thoroughly discredited Quango set up by the Prime Minister when he was Chancellor.

I would like to remind you that the action by the UK government through SI 2008 2674 has carelessly (and unlawfully in my layman's view) deprived many of their life savings (me included), has made some people destitute and I can't help wondering when this situation will drive someone to suicide. Will it take a tragedy like that to make the UK government take responsibility for its actions and show some humility as suggested by Alistair Darling(2) or will they act sooner?


Yours Faithfully,

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