EPS 1 and 2 and bond holders

  • bobwin
  • 23/12/08 n/a (free)
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Posted: Thu, 12/03/2009 - 03:54

The IOMT is paying out 20,000 to joint bank depositors---maybe more if 3/4/5 names.

They are also paying Bond holders(joint+) a maximum of 11,000.

ALL these payments will be offset against ALL future payments from any source!

If I were a bondholder, I would be grateful---well a little only.

The DCS would be less generous to bond holders by definition.

High value depositors will lose out in this system as the money they might get in the future will go to IOMT to pay the EPS2 pay outs to bond holders.

Can anyone challenge the premise that SOA is a foregone conclusion?

If DCS were applied, all bond holders would have to return the majority of the cash from EPS.

Please tell me I am wrong!

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Tax implications of the EPS

  • Anonymous
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  • Thu, 12/03/2009 - 12:27

Where 10k GBP represents more than 5% of a bond are there any tax implications in applying for EPS?

@Bobwin: Tell me what is your situation?

  • follow_the_tao
  • 11/10/08 31/05/09
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  • Thu, 12/03/2009 - 04:37

First do you understand why bond holders are being treating differently?
They are being treated differently because they do not contribute to the compensation scheme.
Think about it, why should even joint depositors receive 2x or 3x the base protection?
Ridiculous? Yes or no?

I see it as perfectly reasonable that EPS payments are offset against future claims.

What I do not see as reasonable is that IoMG, by way of compensating for the pain suffered by all for the delay of a normal liquidation payment whilst they mess about with an SoA, are gathering to themselves the voting power that goes with these assets. Assets that are assured to themselves by subrogation.
This is so cheap, and absolutely unnecessary. But who are you going to complain to? Do the IoMG respond to your mails? I do not believe so. They seem to run, not to put too fine a point on it, a dictatorship. There is no negotiation with the IoMG. The ioMG has a inflated/distorted view of their own importance, whilst disguising their dependence. They are actually totally subservient to the economic interests of the financial industry that has set up home there. The government does their bidding.

You seem confused. They, the IoMG dissumulate. I watch on more and more amused by the intellectual incapacity of the IoMG to understand the real situation. In psychological terms, in old freudian psychological terms, this is known as denial.

There is currently a world of high level, high quality debate about these issues. There is a real consensus developing behind ideas that are sympathetic to our position and antithetic to those of the IoMG. Now what are we going to do?

I require that the IoMG starts talking to me like the informed, articulate, victim of its administration of my finances, that I am. I require that it takes responsibility for the failings of its agents.

Mr Brown can email me. I am waiting. He is not in control of the situation, the Isle of Man has been hijacked by pirates.


  • bobwin
  • 23/12/08 n/a (free)
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  • Thu, 12/03/2009 - 07:31

I can see that you are articulate.

Can you address my main point please---the IOMT is paying bondholders more than they would receive under DCS until liquidated assets become available.

Seems to me that this means they believe DCS is not an option worth considering for them.

The cash supplied to all for EPS will be deducted as soon as more assets are realised---am I dim or does this mean that high value depositors will have to wait longer and/or get less than otherwise? e.g under DCS?

@bobwin: Aren't bondholders like depositors in that.....

  • follow_the_tao
  • 11/10/08 31/05/09
  • a depositor
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  • Fri, 13/03/2009 - 04:16

there are some with small amounts in bonds and others with large amounts?

For someone with a significant amount in bonds then the DCS as it stands is of no interest to them.
They ought to be able to vote with the high value depositors.
There is a creditor class question here. This is a serious question.

The point you wanted answering has been answered now so I'll leave it.

(&points taken, sorry about that...)

Bond Holders

  • bobwin
  • 23/12/08 n/a (free)
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  • Fri, 13/03/2009 - 06:51

Bond holders have essentially zero protection under DCS since the insurance company is deemed to be a single depositor in the same way as a company and the maximum compo is 20,000 I believe in TOTAL.

Under EPS they are getting more--11000 per bond max.

Hence my point regarding the view of SOA by IOMT as a definite front runner as it may well treat bhs in the same way as depositors--we shall see--that is what the insurance companies asked for on 19th Feb.

The IOMT seems to have snubbed them in changing the treatment of bhs under EPS2 effectively halving the early payment for joint holders.

It appears that IOMT don't have much interest in the "poor" insurance companies.

That makes a lot of sense to me---they get their profits from bonds(through charges) whether the value goes up or down--some were still charging after the cash was frozen!

BHS receiving early payment may find that this is a chargeable event under UK tax laws and should ask the question .

Bobwin I agree. The IOM are

  • dclf1947
  • 10/10/08 31/08/09
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  • Thu, 12/03/2009 - 08:45

Bobwin I agree. The IOM are using high value depositors to fund the schemes. i am sure that they have an insight to the probable recovery and all calculations are based on this figure to ensure in the end it costs them nothing. As well as paying the bond holders EPS the IOM also modified the DCS payout from 75% of 20000 (I.E. 15000) to 50000 after the bank was put into administration. The difference between the 15000 and 50000 will be met by higher depositors. You have a situation where the people who will not receive 100% of their deposit back anyway are actually giving up more to ensure other depositors do get their 100%. There is no doubt in my mind that the high value depositor will wait longer and get less no matter what happens at the present moment.

dclf1947 dcs nonsense

  • Anonymous
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  • Fri, 13/03/2009 - 11:11

"The difference between the 15000 and 50000 will be met by higher depositors."

I thought the DCS would be funded solely from future contributions from banks registered in the scheme. But no. The IoM steps in with a potential 150m. Now, you, dclf1947, are claiming that higher value depositors will be chipping in!

The scheme manager is going to ask former depositors to help out?

You are having me on here, aren't you, 1947?

May I bother you by asking for the clause in the DCS regulations that pertains to contributions by "higher depositors"?

Question ..

  • chipmunk
  • 13/10/08 31/05/09
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  • Thu, 12/03/2009 - 08:40

Bobwin can you pls clarify the Bond issue as I have not been on this site for some time. I was under the impression that the EPS 10K would be paid to the Insurance company that hold the Bond and that would be shared between many, many people who had deposited within that single Bond..is this now not the case ?
I am a large depositor via a Bond.....I have tried to talk to my Life company many times about this but its not clear. What is clear is that they seem to favour (Strongly) the SOA even though they say they do not know whats in it yet...........very worrying as they will on my behalf accept the EPS money and I have no say it seems....
Your comments please.

EPS 1 & 2 and Bond Holders

  • bobwin
  • 23/12/08 n/a (free)
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  • Thu, 12/03/2009 - 10:06

Hi Chipmunk,

Simple--under EPS1 joint bondholders get 2000 GBP.maximum.

Under EPS2 they get 9000GBP.

So as joint holders you would get 11000---as a single holder, 10000.

Under DCS you would get a share of 50,000--ie divided by the number of individual INVESTORS in the bond.
You would have to wait for liquidated assets to get anymore.

Under the SOA, it would " appear " that bond holders will be treated like depositors although this is entirely UNCLEAR!

IF this were the case, it would have to be funded by IOMT presumeably, who would then want their cash back PDQ--in the case of EPS payments---as soon as any further cash becomes available from any source.

When total liquidation assets hit 60% they will take everything they gave back before another penny is paid to depositors OR investors.

I hope that is clear

Bob in Davao

Bondholders and £10,000

  • zoggy
  • 13/11/08 31/05/09
  • not prepared to answer
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  • Thu, 12/03/2009 - 09:53

According to my insurance company the bondholders have EACH received the intitial £1,000 but have been refused the additional £10,000. My insurance have objected to this anomoly. Maladministration continues!!

Bond Holders and 10000

  • bobwin
  • 23/12/08 n/a (free)
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  • Thu, 12/03/2009 - 10:10

I have received my EPS 2 papers and bondholders are entitled to a further 9000 only--whether joint or not.

So joint get 11000 in total and singles get 10000 in total.

Bob in Davao

Confused! - here is the

  • zoggy
  • 13/11/08 31/05/09
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  • Thu, 12/03/2009 - 10:44

Confused! - here is the statement from Royal Skandia:-

"enhancement of this scheme to increase payments to a total of £10,000 has also been approved by the Government and we are now awaiting details with regards to when funds will be made available. Unfortunately we are disappointed to report that this additional payment will only be made per Bond and not per Bondholder (ie there will be no distinction between single, joint or multiple bondholders; the same payment will be made to all). This differs to the treatment of the initial £1,000 payments, a crucial and material difference that we have raised with the Government on behalf of our affected bondholders as we feel consistency should be maintained"

Insurance Cos.

  • bobwin
  • 23/12/08 n/a (free)
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  • Thu, 12/03/2009 - 10:52

They want consistent preferential treatment--why?

deal or no deal--it seems the insurance cos. have been shafted also----get real--you are dealing with the IOM---a bunch of scheisters---they won't get any money from you under DCS or SOA so they won't give much--dig into your huge reserves and pay your clients you greedy bast**ds.

Insurance Companies

  • Grahame
  • 11/10/08 n/a (free)
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  • Fri, 13/03/2009 - 13:43

Well said, but it is water off a duck's back to those people. We still hear nothing from Norwich Union. We have still not had our £2000!

Insurance Cos - Bobwin is correct

  • IanAbroad
  • 11/10/08 13/08/09
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  • Thu, 12/03/2009 - 21:39

I have to agree with your last statement Bobwin. The insurance companies selling these bonds are the biggest sharks in the sea.
The insurance companies are very happy to take heavy upfront charges, but seem to be washing their hands of it all now.
Greedy b4stards is not strong enough, theives is closer to the truth.
I am an expat, was approached by a 'Worldleading Financial Services" company trying to sell me bonds for all the usual reasons, a) withdraw 5% tax free per annum, b) deposit grows tax free, c) 'safe' investing, d) built in life insurance (the key to the 'scam') and decent returns
When I dug into it and got some more documentation than the brochure the salesman was offering me, I discovered:
1) Charges are upfront
2) if you drop out/stop paying before the fixed term, (yes, you have to sign up to pay for 10 - 15 - 20 years) the company STILL take the charges/commision out of your deposit month on month until they get to the fees they would have earned had the policy gone the full tem you signed up for
3) if you try to cash in, they take the fees out that they would have earned and give you the change
4) Charges would mean a £500 a month policy would take 8 years to recover from the charges, ie, you can pay in for 8 years, and only have what you had paid in and that's if you get any return from the investment(s)!
5) increasing your dividend results in higher charges. Subsequently reducing your payments, and the charges stay at their higher rate!
6) pament holiday? no problem, they take their charges from what you have in the pot already
7) you still have to pay charges/commision on the actual investment product you buy and put in the insurance policy, so another layer of charges
8) multi layered charges make understanding the pricing very difficult
There were another couple of undesirable clauses all, but I can't quite remeber them accurately now.
When I worked out the % commision, it was about 8%, fixed. Anyone who has one of these things must be getting wrung dry now. Even if you got a bond with a bank paying 10 or 11%, take out the charges and you get peanuts.
In any case, these bonds are another financial scam to milk more money from punters, IMHO.
For me, after having come out with zero profit after a 10 year endowment matured, all the bells were ringing too loudly.
They seem to be products sold to foreigners living in foreign lands, from foreign companies based in foreign countries from point of sale, where the investments are held in another foreign country. Where on earth is the security in that? Everyone involved will dodge any responsibilty, as we see now.
My example, I am British, living in Switzerland, they were based in Luxembourg, trying to sell me policy from Italian insurance co, where my bond was free for me to choose, so from another country (not much advice from them there then!), and held offshore in IoM.
Even to the point where the insurance companies selling these 'wrappers' would not even advise on the product that you invest in and put in their 'wrapper'.
The responsibilty to pick the products is between you and the salesman, and most of these guys are just that, salesmen. The one I saw wasn't even an IFA in the UK, let alone Switzerland. He had been on a 6 week (sales?) course though.
In fact they were not allowed by law to sell these products to the Swiss citizens! You can't buy these products in the UK ! They can not be sold to Americans!
I wish the bondholders good luck with the bloodsucking bastard5, really.
Please take a shortwhile to read your policies though. As for anyone thinking of 'investing' in one of these things, check the small print, do some maths, and have a good, long think about it first.
That's my rant over. I apologise it is nothing helpful in getting our 100% back.