Key issue against the SOA

  • frog
  • 10/10/08 13/09/09
  • a depositor
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Posted: Fri, 03/04/2009 - 22:32

In the latest affidavits, the one key issue I have with the SoA is that the IOM Treasury has equal standing to the Creditors' Committee (i.e they have a veto) on any action that the scheme manager would want to take. This would be different to a liquidation where the government could not get involved (unless something illegal was proposed) , and the liquidator would act in the best interest of ONLY the creditors.

We know that the IOM Government has wider issues than just getting the maximum payout for the creditors, and due to their very limited exposure to the bank over and above what the DCS would have to pay anyway, they should not get the veto. The Creditors' committee should be able to veto the Treasury's veto if necessary.

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IOMG CONFLICT OF INTEREST

  • Wombat761
  • 30/01/09 20/03/15
  • a depositor
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  • Sat, 04/04/2009 - 03:03

This emerges very clearly from the DAG Discussion with Alix & Spellman a few days ago.

I believe that the major task of our Lawyers at the Hearing is to persuade the Deemster in the strongest legal terms that liquidation is the only way forward (given current limited options and minus any outside loan or Govt contribution - which he cannot influence) which will be in the interests of creditors as a whole and guarantee ALL DEPOSITORS / CREDITORS A FAIR AND EQUAL CHANCE to maximise the recovery of their funds. Otherwise there are just too many fingers in the pie!

Noting that the UK Administrator also has resurrecting KSFUK in some form, in his sights , and that is probably the wish of UK Govt, liquidation is probably the best way to obtain a contribution from both of them (KSFUK - ie E&Y & UK Govt) .


Key Issues against the SOA.

  • podather
  • 10/10/08 31/05/09
  • a depositor
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  • Fri, 03/04/2009 - 22:44

On the subject of exposure to the bank they originally agreed to leave their £10 million deposit in the bank until everybody else got paid.
I see from MS affidavit that has been reduced to £2.8 million
Taking into account that 74% of creditors are less than £50k so get the lot either way that leaves £7.2 million less to be distributed amongst the remaining 26% , almost £3000 apiece as an average.


Key Issues against the SOA.

  • Anonymous
  • Offline
  • Sat, 04/04/2009 - 00:36

I think this reduction by roughly £7m has been known about since just after the last hearing, when it emerged that about 3/4 of the IOMG's deposits were under the control of a third-party fund manager of some kind rather than directly under the control of the IOM Treasury.

Of course there is nothing to stop the IOMT compensating for reneging on its earlier assurance and coughing up an extra £7m of its own money to put into the fund until everyone else gets paid.


On SoA

  • Anonymous
  • Offline
  • Sat, 04/04/2009 - 00:30

I have decided to stay uncharacteristically quiet about the long-awaited SoA document until I have finished studying it. All I wanted to say for now is that the 70-odd page document exhibited appears to be what I have been asking for since December 2008 in that it is in the form of an agreement, embodying precise terms, rather than a projection, illustration or presentation. Unfortunately it has been delivered so late that there really are no more than about 3 days including the weekend for us to disect it, and that is clearly not sufficient time to do it thoroughly.


£2.8M

  • manx-person
  • 17/10/08 31/05/09
  • not a depositor
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  • Sat, 04/04/2009 - 00:07

I think the other £10m - £2.8 is actually in a client account of S&F Investment Management IoM (the investment business of KSF).
Whilst IoM Treasury have a beneficial interest in these funds, they dont have legal ownership.
They would therefore not be able to depone that they would defer any rights in this respect,
In making this comment, I aim to clarify the facts,
For the record I agree that this departure from the stated position is very unfortunate, and I would suggest not approporiate in the circumstances.


@manx-person, legal mind?

  • spellman
  • 04/04/09 31/05/09
  • not prepared to answer
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  • Sat, 04/04/2009 - 08:31

It appears that manx-person understands this whole scenario, and offers some very good advice. It is also evident that she has substantial influence within the local community. Why is DAG spending a lot of money on legal advice when there are some exceptional legal minds already on this website?

If anyone knows her real identity maybe they should be directing DAG towards her.


sidetracked

  • Anonymous
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  • Sat, 04/04/2009 - 01:40

Maybe at this stage it is important not to get side-tracked too much on amounts less than £10m, when there is still an anticipated overall shortfall in recovery of at least £200m if IOMT start taking back at 60% (and I think that is optimistic), so the amount by which IOMG has reneged is ~ 3% or less.


£7.2m

  • Anonymous
  • Offline
  • Sat, 04/04/2009 - 00:37

Manx-P: But a departure that could quite easily be compensated for by the Treasury


SoA Reduced by £7.2 million

  • steveejeb
  • 10/10/08 31/05/09
  • a depositor
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  • Fri, 03/04/2009 - 23:42

That is certainly looking after the depositors isn't it? I suppose that the IoMG have to try to recoup the money wasted by Alix, £530,000 as of February and rising. It will also go some way to helping with the £5million PR Budget that they have just announced to enable the IoM to promote themselves globally this year.

It gives me a warm fuzzy glow to know that before we have even started, the IoMG is going back on earlier statements and now intends to penalize depositors yet further in this whole sorry mess of their making. If anyone actually believes what is contained in the SoA and that it was developed to try to help depositors and that they are looking after our best interests, forget it. To those in the 26% you have just lost another £3,000.