Letter to MP Greg Mulholland

  • Dunworkin
  • 23/10/08 31/05/09
  • unspecified
  • Offline
Posted: Wed, 15/04/2009 - 15:28

Just sent the following to my MP

Dear Greg Mulholland,


I wrote to you some time ago about my wife's predicament with savings deposited with the failed Kaupthing IOM bank. You asked to be kept informed.

The current situation, as I understand it, is that the Isle of Man has approved a Scheme of Arrangement, avoiding liquidation. This means that savers with up to £50,000 deposited should be repaid within 2 years.

Unfortunately, my wife deposited in excess of £50,000 from the proceeds of an inheritance, just weeks before the bank collapsed. She will only be compensated in full if cash deposited in the UK can be reclaimed, which is where I hope you can help.

Kaupthing IOM needs £900m to repay all it's depositors in full.

Kaupthing IOM has £540m

The Isle of Man has agreed to contribute £180m if necessary to repay all depositors up to £50k

This leaves a shortfall which will mean that savers with amounts deposited over £50k will only receive a proportion of their deposits over this sum.

There is a solution, which is where I seek your help.

Shortly before Kaupthing IOM collapsed the FSA persuaded the company to lodge £555m with Kaupthing UK on grounds of financial safety. The Treasury then froze the assets of Kaupthing UK when the bank was placed in administration.

The administrators of Kaupthing UK transferred the assets to Ing Bank, eventually issuing a statement that after meeting all the bank's commitments there was a surplus of £1.368bn.

What we are asking is, could you please ask the Treasury if it will allow the Kaupthing UK administrator to refund the £555m due to Kaupthing IOM from these surplus funds, which would allow all depositors to be paid in full.

I would like to point out that a precedent has been set already. JJB Sports founder, Dave Whelan, reportedly had £45m invested with Kaupthing IOM. It is reported that last month Wigan MP, Neil Turner, appealed to Alistair Darling on behalf of Mr. Whelan to have his money refunded, and that within two hours The Treasury called back to confirm that this sum would be returned.

Now, in my view all depositors have to be treated equally, so, if Mr. Whelan can be compensated so should every depositor. If these funds are not returned then it is simply a disgrace.

So to reiterate, could you please ask Mr. Darling if he will facilitate the return of Kaupthing IOM funds held in the UK, in order that all depositors can be paid in full.

Yours sincerely,

John Calvert

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