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BBC Radio 4's Money Box Saturday, 21 February 2009 at 1204 GMT & Sunday 22 February 2009 at 2102 GMT.

Posted 21/02/2009 - 07:44 by Yorkie

2009-02-21 (All day)

BBC Radio 4's Money Box will be broadcast on Saturday, 21 February 2009 at 1204 GMT.
The programme will be repeated on Sunday 22 February 2009 at 2102 GMT.

Kaupthing Isle of Man
Kaupthing Singer and Friedlander Isle of Man (KSFIoM) savers should receive back at least 60% of the money they have lost under a scheme of arrangement approved in a Manx High Court hearing on 19 February.
Treasury officials believe the scheme would offer a better outcome for the 10,000 depositors than a liquidation.
The hearing was adjourned until 9 April for further changes to the scheme, which needs depositor approval.
But why aren't depositors happy?
We speak to John Spellman, director of the Financial Services Division of the Treasury, Isle of Man Government

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Kaupthing arguments continue at courthouse

2009-02-18 16

Discussion over whether the collapsed Kaupthing Bank should go into liquidation are continuing at Douglas courthouse this lunchtime.

Lawyers are arguing the case for a winding up order to be granted, but there are also calls for a further adjournment to allow the Treasury's Scheme of Arrangement to be implemented.

The benefits of both proposals have been outlined to a packed courtroom number one.

Deputy Deemster Andrew Corlett is continuing to hear legal submissions.

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An inquiry is to be held into the Kaupthing Singer and Friedlander affair

2009-02-17 22

An inquiry is to be held into the Kaupthing Singer and Friedlander affair, but Tynwald has adjourned further consideration of the matter until the May sitting.

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TRANSCRIPT OF BBC RADIO PROGRAMME, PM, INTERVIEW WITH MR TONY SHEARER, EX-CHIEF EXECUTIVE OF SINGER & FRIEDLANDER BANK, FEBRUARY 18TH 2009

2009-02-17 16

TRANSCRIPT OF BBC RADIO PROGRAMME, PM, INTERVIEW WITH MR TONY SHEARER, EX-CHIEF EXECUTIVE OF SINGER & FRIEDLANDER BANK, FEBRUARY 18TH 2009

http://www.bbc.co.uk/radio4/progs/listenagain.shtml#p
http://www.bbc.co.uk/iplayer/console/b00hhmmz

47.04

Eddie Mair:
The former Head of a British bank has told PM that the Financial Services Authority ignored repeated warnings about the operations of the Icelandic Bank Kaupthing, and should not have approved its purchase of the bank he once ran.

Tony Shearer was the Chief Executive of Singer & Friedlander Bank in 2005 when it was taken over by Kaupthing, and says he and others were concerned about the bank for years before its collapse last October. He’s given his first interview to our reporter Michael Buchanan, who’s here. Michael.

Michael Buchanan:
Eddie.

Singer & Friedlander was a century-old English bank that was placed in Administration last October as part of the failure of Kaupthing, the Icelandic bank who’d bought it as you said in 2005. Now, Tony Shearer, the former Chief Executive, says the FSA repeatedly ignores, ignored concerns about the Icelandic bank both prior to the purchase and afterwards, up until 2007 at least, and the degree to which these people were senior bankers is highlighted by the fact that one of them, Warwick Jones, is currently the Finance Director of the Bank of England itself.

Mr Shearer appeared before the Treasury Select Committee earlier this month but in his first interview he says he became concerned about the Icelandic bank during a visit to Iceland in 2004.

Tony Shearer:
We had lunch with the President of Iceland, we had drinks with the Prime Minister, we met the Head of the Stock Exchange there, we met the Head of the Regulator there. There was a sort, aura around them, around Kaupthing, I mean, this was the major player, I forget what they were, 40, 50, 60% of the Icelandic Stock Exchange. This was the major player in the Icelandic economy and in Financial Services and they were all very, very proud of that. That concerned me because it seemed to me therefore that there wasn’t much independent thinking and when you looked at the composition of the Board it was all very similar people from an Icelandic background, I think there was one person who was either Swedish or Danish, but the rest were people from a relatively small pool who didn’t have much experience of either international matters or banking. The second thing was then going round the office and I spent a day going round the office, meeting people in the office, seeing who was heading up functions and so on. They weren’t people who had got any experience of international banking or international business.

Michael Buchanan:
And when the FSA were subsequently looking into whether they should allow effectively Kaupthing to buy your bank, you expressed all these reservations to the FSA?

Tony Shearer:
Yes.

Michael Buchanan:
And how did the FSA respond to your concerns?

Tony Shearer:
They weren’t particularly interested, that was my impression. I mean, it wasn’t just me, a number of my colleagues went and expressed their own views. In fact, one of the meetings I had with the FSA two of my other colleagues were there as well. But I think we all had the view that there wasn’t really much interest in the points we were making.

Michael Buchanan:
You and your colleagues, you were senior people at a British bank going to a British Regulator and saying, You really have to look closely at these people before you approve the takeover of our bank. And in fact the FSA ignored your concerns?

Tony Shearer:
Yes.

Michael Buchanan:
Subsequent to that, other senior managers at Singer & Friedlander went to the FSA and raised other concerns, so these concerns were not just raised by you and your colleagues in 2005, they were continuing through 2006 through to 2007?

Tony Shearer:
Yes. Obviously most of the concerns were raised in 2005 as you rightly say, not just by me, subsequently, erm, both the Heads of Risk and the Heads of Compliance were both asked to leave as well, and I’m, I’m, they both told me, they told me at the time that they went to the regulator, the FSA, and explained why they’d been asked to leave. Both of them had expressed concerns that the bank was being run, though it was a deposit-taking institution, it was being run as a sort of private equity fund.

Michael Buchanan:
What do you think the FSA should have done with all the concerns that were brought to their attention?

Tony Shearer:
I always remember we said amongst ourselves, that if anything ever went wrong with Kaupthing, and somebody went back over the FSA’s files, there’d be quite a lot of interesting material sitting on the files, and I believe that is the case. I think what the FSA should have done is taken more care before making the change of control approval. If they had accepted then that they should have made the change of control approval then they should have increased the monitoring. I mean, their response to my evidence to the Treasury Select Committee was to say: Yes, Mr Shearer did tell us about his concerns and so on but we consulted the Icelandic Regulator and we put in two non-executive Directors. I mean, to me consulting the Icelandic Regulators is a bit like asking Ronnie Biggs’s mother for a character reference on Ronnie Biggs. I mean, it was not the basis, if you wanted to do it then it seems to me that you’d say, Okay, let’s increase the surveillance, let’s increase the monitoring.

Michael Buchanan:
In your opinion, the FSA should not have allowed Kaupthing to buy Singer & Friedlander.

Tony Shearer:
I’m, I’m not necessarily going as far as that, I mean, in fact I think I probably am actually, but I think if they did do that then they should have increased their surveillance and monitoring afterwards. I mean, to say that you’ve appointed two non-executive directors on the board, and expect them to control the whole environment, and to counteract the things that we’d expressed concerns about, as part of the bigger group, seems to me be unrealistic.

Michael Buchanan:
Could you see the problems that subsequently developed at Kaupthing, Singer & Friedlander? Could you see them coming?

Tony Shearer:
Did I expect the bank to collapse in the way in which it did? I didn’t foresee it in that way but it struck me as being very likely would run into trouble.

Michael Buchanan:
Because the bank that you once ran became a far riskier bank and it was sooner or later going to run into problems because of that?

Tony Shearer:
Absolutely. I didn’t foresee the turbulent times that we’ve got now, that’s true, but any slight change in the times in making them less of a boom than we were having seemed to me to be one that would threaten the business model that they’d got. Absolutely.

Michael Buchanan:
Now I’ve spoken to the FSA this afternoon who’ve reiterated the statement they made when Mr Shearer appeared before Parliament, which says, in part:

It is important to note that the failure of Kaupthing, Singer & Friedlander related to different issues, in particular, the impact of the global financial crisis on the group’s liquidity.

Eddie Mair:
Michael. Thank you very much, Michael Buchanan, with an update on a story we’ve followed for some time on PM and on iPM.

53.22

Transcribed by Hoping and Coping

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Depositor alleges KSF 'cover up'

Posted 12/02/2009 - 14:19 by Hoping and coping

2009-02-11 16

An angry depositor who had his entire life savings in the collapsed bank Kaupthing Singer and Friedlander Isle of Man says an investigation needs to be carried out.

[Continues]

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Tony Brown in the Tynwald defends his disgraceful behaviour before the TSC3/2

Posted 10/02/2009 - 15:09 by Lucky Jim

In the IOM Parliament today Tony Brown, Chief Minister defended his behaviour by saying : "The only bad PR came from depositors who have a different interest from that of my interest which is for them and the whole of the Isle of Man."

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Kaupthing Singer and Friedlander depositors growing impatient

Posted 07/02/2009 - 04:35 by Hoping and coping

2009-02-06 16

Kaupthing Singer and Friedlander depositors growing impatient
Published online at 04/02/2009 19:43:28

Ard-ayrniagh ayns colught-leigh Manninagh, t'eh gra dy nee boiragh lhiggey shaghey yn briwnys vees jerrey currit er banc Kaupthing ny dyn, as ta'n boirey çheet dy ve ny smessey. Ren banc Kaupthing failleil.

Y çhiaghtyn shoh chaie, son y trass cheayrt, va sarey dy chur jerrey er y vanc currit ry lhiattee ec eaishtaght, tra dooyrt fir-oik veih Tashtey Vannin dy jinnagh nyn Skeym-reaghee (Scheme of Arrangement) shickyraghey dy noghe lhiaghteyderyn argid erash ny s'tappee na Skeym-lhiasee ny Lhiaghteyderyn (Depositors' Compensation Scheme).

Eeckagh y reiltys, y kerroo-banceyraght as argid feddynit erash son y Skeym-reaghee. Agh Jonathan Smalley, ayrniagh sy cholught-leigh Stuart Smalley as Colught, t'eh cur faaue dy vel ny lhiaghteyderyn çheet dy ve meehurransagh.

Dinsh Mnr Smalley da Radio Vannin: 'Er lhiam dy row dailleyderyn feiy ny cruinney jeant booiagh ec aghtey breeoil y reiltys, agh er lhiam dy vel ad goaill toshiaght dy chaghlaa nyn aignaghyn nish, er yn oyr dy vel yn aghtey breeoil er jeet dy ve myr lhiggey shaghey dy firrinagh. Erskyn ooilley, she cooish vooar jerrey ny bleeaney argidoil as yn aght vees shen jannoo er Skeym-lhiasee ny Lhiaghteyderyn. Er lhiam dy bee sleih feer voirit my hemmayd shaghey yn daayt shen as bee yn ablid caillt dy hymsaghey argid veih ny bancyn sy vlein argidoil t'ayn nish.'

Lurg y lhiggey-shaghey s'jerree jeh'n eaishtaght dy chur jerrey er y vanc, ta un laa jeig as feed ec y Tashtey dy yannoo baghtal ny cooishyn va troggit sy whaiyl. My hed y Skeym-reaghee er coardail, yiow lhiaghteyderyn argid erash er yn eeckys çheusthie jeh tree mee.

Ec y traa cheddin, bee eh shirrit er olteynyn Tinvaaal ad dy choardail rish eeck jeih meeilley punt (£10,000) da gagh peiagh as coontys oc lesh Kaupthing Singer as Friedlander Ellan Vannin fo'n Skeym Eeckyssyn ah (Early Payments Scheme), va coardit hannah. Veagh daeed sy cheead (40%) jeh ny lhiaghteyderyn geddyn ooilley nyn argid erash myr shen

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TUC call to UK banks

Posted 07/02/2009 - 03:41 by Hoping and coping

2009-02-06 16

There’s a new call for United Kingdom banks to disclose their activities in offshore jurisdictions – this time from trades unions.

The TUC says Lloyds, RBS, HSBC and Barclays have more than 1,000 subsidiary companies between them in the offshores.

In a list of tax havens produced by the TUC, the Isle of Man is the ninth most popular jurisdiction for banks to set up firms.

General secretary of the TUC Brendan Barber (pictured) says because the UK government holds stakes in many such locations, and stands ready to bail out others, the country's taxpayers have a right to know the full extent of bank activities and liabilities elsewhere.

There is some good news, as the TUC says it accepts not all subsidiaries in offshore jurisdictions are necessarily used for tax avoidance.

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Manx Radio supports the DAG in the criticism of Tony Brown

Posted 05/02/2009 - 23:40 by Lucky Jim

The Radio reports critically on Tony Brown's performance before the Treasury Select Committee on 3/2 and gives wide coverage of the DAG's feelings, including quote from a member of the DAG

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Aspden gives evidence in Westminster

Posted 04/02/2009 - 13:01 by Hoping and coping

2009-02-03 16

The chief executive of the Financial Supervision Commission has been questioned about the Kaupthing Singer and Friedlander affair.

John Aspden was in a group of Isle of Man representatives quizzed by a United Kingdom Treasury Select Committee on the UK banking crisis, and associated issues, at Westminster yesterday.

When asked why £550 million was transferred from KSF Isle of Man to the UK branch of the bank, Mr Aspden said the situation in Iceland posed a great deal of risk.

He said:

"The reason was that, as the regulatory body on the Isle of Man, in the early months of 2008, we were concerned about the country risk presented by the amount of deposits lent from the Isle of Man operation directly to Reykyavik.

"In the regulatory body we were discussing this in January and February and, as the evidence says, in March we came to the view that we didn't want to incurr any Icelandic risk."

Meanwhile, it seems there was some confusion on the UK Treasury committee yesterday on the location of the Isle of Man (play attached audio file):

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