Open email to Mr Brown

Posted 06/02/2009 - 08:33 by Tricky Dicky

Below is an open email I sent to Mr Brown, copied to Mark Shimmin and Allan Bell, part of this was read out by me at the behest of Manx Radio who wanted to do an interview, but were very happy to use part of this email.

Dear Mr Brown,

Following your performance at the Treasury Select Committees meeting on 3rd February 2009, you must be congratulated on taking all the problems associated with KSFIOM going into provisional liquidation on the chin.

What I cannot congratulate you on, is the acceptance by yourselves (the IOM Government and associated Financial Authorities) that the UK Government is not, in any way to blame for the collapse of KSF UK, and subsequently the inevitable collapse of KSFIOM. It is understood that as Politicians, there are political games to be played between yourselves and HMG, but the obvious bully boy tactics of HMG must be stood up to – after all we teach our children not to accept and to stand up for honesty and integrity.

Unfortunately whilst you are playing games, people’s lives are at risk and being lost due to your inactivity. Given the opportunities that you, and your team of colleagues were given by the TSC to answer honestly the questions posed, it is incredulous that you did not have the courage to do so. Mention was made that the IOM is “a well-regulated transparent jurisdiction”. It appears very transparent that there is a large cover up within your Financial Services industry, that is being and will be exposed. Premier Low Risk Fund plc being one, KSFIOM, its Holding Company, and associated company Marriott (IOM) Ltd being another. Your comment that the depositor’s compensation scheme ‘has served us well’, rings exceedingly hollow, it may have served you well, but it doesn’t appear to serve depositor’s well, or in fact any scheme proposed as yet by the Government.

Every other country, which has been touched by the Kaupthing problem has bitten the bullet, as necessary, to refund 100% of monies to its depositors from whatever nationality they come from, it is incomprehensible why the IOM cannot follow the others. Quote “It applies international standards to the highest level” Mr Brown TSC Meeting 3 Feb 2009

There is only one answer to the problem of KSFIOM, and that is for you to find a solution to return 100% of monies to all those who deposited in KSFIOM. Quote “our commitment to do the best for the depositors is well-known.” Mr Brown TSC Meeting 3 Feb 2009.

Quote “They came back with a proposition that the most convenient thing to do, apart from some reduction in exposure from the figure I have just said, would also be to have the money transferred to the London operation, and then we got into the dialogue I have already referred to in the evidence with the FSA about the terms on which that placement would be made. Those are the circumstances.” J Aspden TSC Meeting 3 Feb 2009 response to Q 569. Would tell us who ‘they’ are, the conclusion is that it is the Directors of KSFIOM? and the terms were set by FSA and FSC?

It is reported that the Financial Services Sector is currently managing £138Billion in assets and that it makes up almost 40% of your economy. There have been many options put to IOMG which would allow them to step in now and fully resolve the issue at a reasonably minimal net cost which would allow the Island to move forward. In fact this could be a platform for massive growth in your industry if IOMG is shown as a strong leadership group committed to its depositors. The IOM would effectively be showing itself as the off shore banking jurisdiction of choice, especially important given the pending actions of President Obama which will drive Billions of dollars away from places like the Cayman Islands and the Bahamas. This is a massive opportunity for the IOM if handled correctly.

Summary of this situation: KSFIOM and FSC made a massive over the limit placement in an affiliate bank (wrong), did not spread the risk across a number of banks (wrong) but left it within the Icelandic group (down right reckless). To use the phrase given me by a contact in the banking industry, "they (KSFIOM and FSC) bet the bank on one throw of the dice and lost it.”


Richard Carter

Further to the above the following email was sent to him:

Dear Sirs,
There is pressure from DAG members to demonstrate the actions taken to encourage IOMG and other authorities to do the right thing by depositors. I am disappointed that you have not found the time or it necessary to reply to my email of 01 February 2009. DAG members are understandably frustrated by the lack of communication from IOMG since the last court hearing. To show this is not due to effort on DAG's part I will be forced to publish our email exchange unless I hear from you within the next 48 hours.


So, the wall of silence continues not only from HMG, but now from IOMG as well

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