Letter from Icelandic Ministry Of Business Affairs Dated 5/10/08

  • gerry paul johnson
  • 13/10/08 31/05/09
  • a depositor
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Posted: Mon, 27/10/2008 - 20:25

Sun, 05/10/2008
http://mbl.is/media/44/1044.pdf

Interesting copy of a letter from Icelandic Ministry of Business Affairs, to UK Treasury, dated just ONE DAY before the wheels were set in motion to cease the processing of fund transfer from Icelandic banks in the UK.
This DOES NOT say that Iceland are not prepared to uphold their responsibilities (as Mr Darling later claimed)

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Source of Icelandic Gov't Letter

  • Alastair
  • 10/10/08 30/09/09
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  • Tue, 28/10/2008 - 02:20

Do you have a source for this letter is it reliable?


expat..Icelandic Govt letter

  • mikeinfrance
  • 12/10/08 28/09/09
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  • Tue, 28/10/2008 - 14:54

It was posted by gerry paul johnson who seems to have been a member for 2wks and is a depositor..don't recall having seen his name before.
Expat.. has this letter been released to the media ?? We don't seem to have sent out any press releases since 24th....who exactly is dealing with press releases?


I have a lot of trouble keeng

  • expat
  • 10/10/08 31/05/09
  • unspecified
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  • Tue, 28/10/2008 - 15:09

I have a lot of trouble keeng up because of computer issues here, no i have not seen the letter but i did just find this

CHANCELLOR Alistair Darling and governor of the Bank of England Mervyn King (pictured) look set to be grilled about the Landsbanki Guernsey collapse at an independent inquiry.

The UK Treasury Committee investigation into the banking crisis is almost certain to cover the issue.

An orchestrated campaign by those with savings in the bank and another by those with money in Kaupthing Singer & Friedlander in the Isle of Man has seen the committee inundated with questions to ask and it is now sifting through the correspondence.

Questions can be sent in up to 48 hours before the hearing sits on Monday and Financial Services Authority chairman Lord Turner of Ecchinswell will be the third witness.

A Treasury Committee spokesman said Landsbanki Guernsey was ‘likely to come up’ after its chairman, MP John McFall, said on Channel 4 News that the Isle of Man would form part of the inquiry.

Talking about the status of the islands in relation to the UK, Mr McFall said that it was an issue the committee had been considering.

‘That’s why we visited the Isle of Man and Jersey and hope to visit Guernsey at a later date,’ he said.


Source Of Letter dated 5/10

  • gerry paul johnson
  • 13/10/08 31/05/09
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  • Tue, 28/10/2008 - 15:08

Sorry Guys, been off the case all day, trying to earn a crust. The provenance of the letter can be traced to an article and follow up comments in yeterdays icenews. The link is as follows

http://www.icenews.is/index.php/2008/10/27/kaupthing-isle-of-man-savers-...

Hope that this helps


welcome back Gerry

  • mikeinfrance
  • 12/10/08 28/09/09
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  • Tue, 28/10/2008 - 15:30

Gerry...I followed your link but couldn't see any reference to this letter.. how did you actually find the letter? correction I just found the link in the comments section!!


Found the Link to the letter

  • Alastair
  • 10/10/08 30/09/09
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  • Tue, 28/10/2008 - 15:36

Thanks Gerry the link to the letter is in a comment below the article from someone called Axle. Further down there is some discussion about whether it is authentic.

Any ideas how to check - could the connections with the Icelandic Embassy help?


Original Source of Letter

  • Alastair
  • 10/10/08 30/09/09
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  • Tue, 28/10/2008 - 15:00

I was wondering what Gerry's source was as it is a very explicit letter and if there is a risk that it is not geniune then we need to be very careful as using it could seriously undermine our case.


expat..in case you havent seen

  • mikeinfrance
  • 12/10/08 28/09/09
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  • Mon, 27/10/2008 - 22:44

Just in case you haven't seen this..could be relevant re the Darling tapes ??

http://mbl.is/media/44/1044.pdf

also found this interesting:
http://www.gov.im/lib/docs/fsc/PressReleases/2ndaffidavitmradoherty.pdf


Letter from Icelend

  • rallison
  • 12/10/08 31/05/09
  • unspecified
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  • Tue, 28/10/2008 - 00:20

That letter only seems to promise they will help with the MINIMUM compensation scheme (50K in our case). As far as I understand, we are guaranteed that much anyway (although WHEN is an issue).


Letter from Iceland

  • mikeinfrance
  • 12/10/08 28/09/09
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  • Tue, 28/10/2008 - 00:57

I think you miss the point! A couple of days later Alistair Darling stated that the Icelandic Government had refused to honour its committments as regards compensation for depositors in Icelandic banks.(not a direct quote)
This letter clearly does not support that claim (nor does the recording of the telephone conversation between Darling and his opposite number in Iceland). Another bit of evidence that Darling lied??


Darling's terminolgical inexactitudes

  • Anonymous
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  • Tue, 28/10/2008 - 01:10

... how much additional evidence do you think is needed?


mikeinfrance

  • thesunnysouth
  • 10/10/08 31/05/09
  • unspecified
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  • Mon, 27/10/2008 - 23:38

I was able to open the first link the letter to Maxwell, that is a wow! Could not open the 2nd. Could you precis what the 2nd link says?
I think this is a major matter (quite how yo tracked this down) as it confirms that the Icelandic govt were making every effort to reassure HMG that they would make guarantees


aiden doherty 2nd affadavit

  • mikeinfrance
  • 12/10/08 28/09/09
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  • Mon, 27/10/2008 - 23:56

The link does work but it's a 2 MB file so you may have to wait for a while..depending on your internet conn.. Far too long to summarise!!!!! many many pages of documents!


Accountants please (Diver?)

  • thesunnysouth
  • 10/10/08 31/05/09
  • unspecified
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  • Tue, 28/10/2008 - 00:25

Can someone with accountancy knowledge look at the Docherty 2nd affadavit. The last exhibit is a statement of accounts as of 30 sept.
Some interesting detail showing assets of £1.3 billion with £182 in cash with other banks (we have only recovered £103) £195 with Kaupthing Iceland, the £557 we know is in the UK and finally advances of £410m, a fairly sizeable loan book. Although £195m is shown with the Icelandic bank this is offset by the other side of the balance sheet which shows deposit from Kaupthing of £185m and from KSF of £164m and a resrve of £38m.
Deposits are shown at £927m which suggsts about £100m left the bank in the first week of October but if the figures are correct there is more money available via the loan book and cash at KSF than is owed to us!!
However it would help if a trained eye could hve a look and give a view. Diver perhaps?


Statement of Accounts

  • barnie
  • 19/10/08 31/03/10
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  • Tue, 28/10/2008 - 00:38

HI Sunnysouth,
There is some discussion regarding the statement of accounts on the forum thread http://www.ksfiomdepositors.org/node/816 (Possible Solution To This Appaling Mess'.
Hope this helps.


letter from iceland to treasury

  • joooojoooo
  • 10/10/08 n/a (free)
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  • Mon, 27/10/2008 - 23:17

googled Clive Maxwell; came up with a number of interesting leads; people who sit ofn the same committees etc. please refer to the powers that be.


aidan doherty affidavit 2

  • joooojoooo
  • 10/10/08 n/a (free)
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  • Mon, 27/10/2008 - 23:14

Thanks for that Mike - it clarifies something that was puzzeling me; I did not understand the precise status of the monies transferred to KSF UK. I now understand that they were being held "in Trust" at the call of KSF IOM; they were not on deposit with, or otherwise available for the use of, KSF UK. Please correct me if I have misinterperated. Thanks again.


A nice idea......however i do

  • mikepapa
  • 10/10/08 n/a (free)
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  • Tue, 28/10/2008 - 00:52

A nice idea......however i do not see anything that says that KSF IOM funds were held in trust by KSF UK.

It does say : "the arrangements in place with KSF (UK) allowed the company to pays its debts including its liabilities in respect of depositors as and when they became due" ???

However, it does not say on what terms these funds were held.

You can be pretty sure if these funds were specifically held in trust - or ring fenced - or held to order KSF IoM
them PWC Mike Simpson would have said so by now.


aiden doherty affadavit 2

  • mikeinfrance
  • 12/10/08 28/09/09
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  • Mon, 27/10/2008 - 23:35

Unfortunately having no legal or banking background I can't really comment, although I'm wondering what specifically makes you draw that conclusion? Is it the word "CASH" rather than "DEPOSITS" ? (under ASSETS)

Actually I just spotted what you might be referring to ...is it :
"the arrangements in place with KSF (UK) allowed the company to pays its debts including its liabilities in respect of depositors as and when they became due" ???


13 (iii) aiden doherty affadavit

  • Alastair
  • 10/10/08 30/09/09
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  • Tue, 28/10/2008 - 00:13

Assume the paragraph being referred to. It also jumped off the page to me. The word "arrangement" could mean anything but certainly suggests that these funds had a formal status in dealings between KSF IOM and KSF UK. I find it hard to believe that PWC aren't all over this, but just in case is there anyone from inside the bank (insider was one) that we have contact with that can clarify what the "arrangement" was.

Money held by KSF UK in trust for KSF IOM as beneficiary would obviously ideal but may have been impossible for tax reasons, a questions for a tax accountant/lawyer?


13(iii) aiden doherty affidavit

  • manx-person
  • 17/10/08 31/05/09
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  • Tue, 28/10/2008 - 00:20

I picked up on this when I heard it read in court by Mr Clucas.
Note the use of the word arrangement and not guarantee
I still fear this could in fact be a letter of comfort rather than a guarantee


13 (iv) aiden docherty affadivit 2

  • mikeinfrance
  • 12/10/08 28/09/09
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  • Tue, 28/10/2008 - 00:34

13(iv) It suggests to me (as a complete layperson), that KSFIOM had an arrangement in place such that the £557M would always be available to them as and whenever they needed to draw on it, ie it enjoyed some kind of special status. After all it had supposedly been moved to KSF UK, from Iceland, for "safe keeping"


Umm...

  • cold-dose
  • 11/10/08 31/05/09
  • unspecified
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  • Tue, 28/10/2008 - 23:18

May I just remind everyone that KSFIOM used KSF UK for its outbound transfers...


Cold dose

  • mikeinfrance
  • 12/10/08 28/09/09
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  • Wed, 29/10/2008 - 00:47

Cold dose..Can you explain the relevance of that ? thanks


KSF UK and KSF IOM Relationship

  • Alastair
  • 10/10/08 30/09/09
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  • Wed, 29/10/2008 - 01:12

Isn't it likely that KSF IOM used its account with KSF UK to settle both incoming and outgoing sterling transactions, running with a sizable balance at all times. There was little need to bring actual funds to the IOM.

This to me further underlines the de fato subsiduary role of KSF IOM to KSF UK.


'Arrangement'

  • cold-dose
  • 11/10/08 31/05/09
  • unspecified
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  • Wed, 29/10/2008 - 20:36

Yes, that's the real reason behind it all, but what I was actually getting at is that this is what anybody would call an 'arrangement', I'm not sure the use of the word applies anything more sophisticated, like collateral.

Basically, KSFIOM's main 'operating' funds were in KSF UK.


This set of accounts is some

  • thesunnysouth
  • 10/10/08 31/05/09
  • unspecified
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  • Tue, 28/10/2008 - 00:48

This set of accounts is some of the best news I have seen on this subject in two weeks. Presumably someone within the bank must be able to explain what the exact status of the £557 is. But at least as of 30/09 the monies deposited with Iceland were set off against the money deposited with them (unless they too drew out £180m in a week!


Indeed............. however

  • mikepapa
  • 10/10/08 n/a (free)
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  • Mon, 27/10/2008 - 21:02

Indeed............. however it only say Iceland will only live up to their depositors minimum compensation limits..... something like Euro 20K ...... a drop in the ocean compared with the total value of deposits.
IMHO - hardly worth the parer it was written on.


Especially ..

  • dawes
  • 24/10/08 31/05/09
  • unspecified
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  • Mon, 27/10/2008 - 22:18

Especially as the Minister verbally refused to to guarantee the deposits in the transcript. I wonder if this document could be used to force the Government to pay up. After all, they keep insisting they intended to pay, but haven't been forthcoming with either the money or any suggestion on how they might borrow it.

I think the 20K euro would equate to the majority of the money in icesave (330k savers, average of about £12K).

That would release other funds to creditors in KSF.