Are FOREX depositors being taken for fools?

  • klauseriksen
  • 10/10/08 31/05/09
  • a depositor
  • Offline
Posted: Mon, 16/02/2009 - 14:12

I am a FOREX depositor with approx 200,000 US$ remaining in KSF. I guess I could have used the username “Lucky Klaus” as I transferred the bulk of my money out of KSF a few weeks before the crash, but somehow I still don’t feel so lucky.
Until very recently I was 100% behind the idea of a controlled payout via an SOA. However after having seen the latest affidavit for the SOA I am beginning to think the IOM is taking us for fools. According to the affidavit +50KUK£ equivalent depositors should expect to get a 60% return on their money before the IOM starts clawing back its loan. Needles to say not much is likely to follow after that happens. The big question is 60% of what. If indeed they chose to use Oct 8 as the calculation date for converting our currency into UK£ then almost all the FOREX depositors (with the exception of Rand depositors) will loose out heavily on the exchange rate.
Using the current exchange rates this would mean that US$ depositors would only see a 49.7% return of their money whereas Euro depositors would only see 53.2% return of their money i.e. NOT 60% as the IOM advertises.
The DCS on the other hand would be obliged to use the date of liquidation i.e. sometime in the future which is much more favourable. Some have suggested that the IOM made a mistake and that we would be able to use the same exchange rate date as in a strait forward liquidation. To me however the choice of the 8 of Oct looks very much intentional so as to make the SOA look much better on paper and to benefit the local IOM savers/voters whom will get a bigger share of the pot.
I am also far from convinced that we will actually get more money from the SOA since in the DCS we get an influx of money from the DCS whereas in the SOA these funds are only lent to us until we have 60% repaid (or in the case of FOREX depositors or lot less). Hence the slower sell of in the SOA would have to make up this difference first before any of us could expect to see a net benefit.
I for one have changed my mind about the benefits of the SOA and am now convinced that the IOM all along was negotiating in bad faith with no or little concern for the benefit of the depositors. Instead they were stalling for time to work something out that would benefit them and not us. I therefore intend to vote against the SOA in its current form and what more if the SOA looks to be implemented in its current form then I intend to raise legal proceedings against it.

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