Questions for Mike Simpson LP - for Jan 26th 2008

  • Anonymous
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Posted: Fri, 16/01/2009 - 22:27

Dear all,

Here is a new thread for any questions for Mike Simpson, Liquidator Provisionally of KSFIOM. Please add any questions you wish to ask below.

Current questions I have so far are:

  1. What is the exposure to KSFUK assuming full setoff?
  2. What was the value of the loan for which the JJB shareholding was used as collateral. (Note the LP seized 58M shares, worth £5.1M and were worth approximately 13 times that value back in September)
  3. What is the status of the Moratorium that the Icelandic Government have put in place which prohibits action against Khf?
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Set Off

  • Anonymous
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  • Sun, 25/01/2009 - 20:14

This might be too late but if possible ask MS why he is talking of set off for some depositors who also have loans with the bank? Most deposit agreements around the world and most commercial contracts including mortgages specifically prevent set off?

Please also ask MS if the general body of creditors is bearing the full expenses in the administration of KSF UK as the UK government is directing the administators to first fufill it wishes ito what it deams to be a priority. Presumably it should therefore pay for that portion of the administartion?

Lastly can MS explain why the KSF UK pension scheme is such a large creditor of KSF UK and is that a valid claim in terms of quantum?


prudential regulation and KSFIOM risk/credit management

  • Anonymous
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  • Fri, 23/01/2009 - 23:36

I have asked this question previously but Mike Simpson did not provide a reply to it. Regulators have guidelines on legal lending limits this is the maximum amount of credit that can be extended to a single counterparty. Normally banks have a 10% of capital guideline for large exposures with around 25% of capital being the prudential reporting limit (i.e. above this limit it has to be reported and agreed with the Regulator). Why was KSFIOM allowed to have such large deposits with its UK affiliate (previously it had held the deposits with its Icelandic parent still excessive but a normally a better credit risk than with an affiliated subsidiary of the parent). The Regulator needs to explain why this was allowed.

Secondly, banks maintain credit limits for ALL counterparties both intergroup and third party. It would be useful to know the extent and nature of credit facilities allowable under KSFIOM's policy for placements with affiliates.

The above goes to the Prudential Regulation and to KSFIOM's own risk management policies if these questions which are basic banking practice cannot be answered then one has to question why as it goes directly to the issue of why the Regulator and KSFIOM's management allowed such a large placement which in the event of a problem would result in an unacceptable level of risk to KSFIOM which was what happened.

I am in touch with a member of DAG who has promised to submit this question to Mike ahead of the meeting so that this time he can make sure that we get answers.


@DSM

  • Anonymous
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  • Sat, 24/01/2009 - 13:18

Thanks - The question was submitted to me (with background) to ask the question. I don't know whether it was submitted to Mike Simpson as well. I have added it as a clarification question to the list (posted below).

Feel free though to contact the bank yourself if you feel the answers aren't as complete as you need - the aim of these weekly calls is to stop repetitive calls into the bank and taking up time to answer when they have other things to do (like evaluate the loan book!) and if there are any detailed points which are not answered, you should follow up directly.


Call-in details for Monday 26th Jan call at 4pm GMT

  • Anonymous
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  • Fri, 23/01/2009 - 22:49

Telephone conference dial in details
Following discussions with the Depositors Action Group I have set up a second conference call which will take place on Monday 26 January 2009 4:00 pm GMT.

I am making the access details generally available to depositors. If you wish to listen to the call, you will need to register in advance. Please click the link to register.

https://cossprereg.btci.com/prereg/key.process?key=PXUFB9G4D

Participation will be on a listen only basis. The facility is provided by a third party and accordingly there is a cost per head for usage. Should any party register and then not attend the liquidation will be charged.

The number of lines is limited and I would request that only those depositors who are able to make the call register as we will make the audio recording of the call available on the website for those of you who are unable to attend. Should depositors choose this route to listen, it will significantly reduce the costs. The audio recordings from the previous calls are available here.


Latest questions for Mike Simpson

  • Anonymous
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  • Sat, 24/01/2009 - 13:20

I've had a couple of new questions asked since I posted the last list - so here is the final. I will ask to have a call soon after the 31st Jan to discuss whatever was decided on taht day.

Previous Questions
1. DAG website address on bank site

A: This will be done also in the next couple of days.
- The site information cannot be found on the site – can you provide its location?
2. What would be the total amount, which the DCS would be obliged, under the current scheme rules, to pay out to all eligible KSFIOM depositors in the (hypothetical) event that the bank had no assets to distribute?

Clarification on Previous Questions

Question 5. Banks are required to have counterparty limits with other banks and for intergroup thus a question on why KSFIOM was allowed to make such a large single deposit. The regulator has set legal limits, which are normally a percentage of the Bank's capital. If £555m sent to KSF (UK) was in excess of 10% of the Capital then this would have breached the standard Regulatory guidelines. Can Mike Simpson confirm that:
a. The counterparty assumptions as set out here, are correct?
b. Were KSF(UK) and KSFIOM working within those 10% counterparty limits?
Answer: This has to do with the amount of money sent outside of the Kaupthing group. About 20% of the funds were in 3rd party banks in the form of CDs and other instruments. In addition, there is the loan book.

  1. Clarification of question.
    We understand that there are indeed risk limits posted against intergroup deposits as well as third parties and that the regulator does not allow unlimited intergroup deposits. That is certainly the case with FSA regulated entities in most countries. All prudential regulation follows certain standard guidelines and concentration and counterparty risk are two areas, which are included in this.

To be clear banks are generally not allowed to deposit intergroup without limit. There are counterparty limits to affiliates and for that matter normally with the parent and other subsidiaries of the parent in the UK. The FSA will question financial service companies about "group risk" and may even require them to keep additional capital where group risk is a concern although normally subsidiaries will argue against this. Bankers normally allocate maximum limits to all deposits including those made to affiliates. Now in this case it seems that previously the deposits would have been to the parent so in deciding to deposit with an affiliated bank would have been considered higher risk as normally the parent is stronger than the sub. Thus it follows that KSFIOM should not have made such a large deposit with the UK bank.
Can Mike Simpson confirm that he has investigated the relevant IOM FSA rules regarding intercompany balances and that KSFIOM has complied with them?

Today’s Questions
4. What was the value of the loan for which the JJB shareholding was used as collateral? (Note the LP seized 58M shares, worth £5.1M and were worth approximately 13 times that value back in September)
• What are the prospects of further recoveries in respect of this debt?
5. What is the status of the Moratorium that the Icelandic Government has put in place, which prohibits action against Khf?

  1. In the last round of questions you state the in-flight monies form part of the exposure to KSF UK - can you confirm these monies will be returned as a bulk deposit at full face value or will they be treated the same as the other up-streamed funds e.g. possibly only returned as a % of the total thereby disadvantaging all creditors to KSF IoM.
  2. Is the LP considering legal action against the directors of the bank in regards to breaching their fiduciary duties with respect to: 
1. Allowing such a large deposit to go to KSF UK unsecured
2. Granting ridiculous loans such as the loan for the JJB purchase using shares as collateral.
  3. The KSF UK Creditor Committee met on 19 January 2009. Does he have any access to information, which was provided to the CC, and if so does he have any update on the payment of any dividend to KSF IOM from KSF UK?
  4. Repeat question from previous call: 'When will we know how much money KSFIOM will be able to get back from the UK or at least a rough idea?'
  5. Aiden Doherty advised us that the loan book consisted only of high quality loans. Please ask as follows:
    • Are there loans in the book, which are now considered to be at risk of substantial under-recovery? 

    • If so what is the estimate of the total amount of under-recovery if the loans are allowed to run to term.
  6. Were there any large movements of savings or shares from KSF (IOM) in the proceeding 12 months by any of the Directors of KSF (IOM)?
  7. On the 8th of October 2008 how many KSF IoM accounts were ex-Derbyshire?
  8. How many of these ex-Derbyshire accounts were fixed term accounts, which had not reached term?
  9. Please confirm that all accounts have had statements issued as of 8th Oct 2008?
  10. From the statements issued how many depositors have returned their conformation details?
  11. Will PwC publish the number of unclaimed accounts, their value and what will become of the funds therein?
  12. Are you (or PWC) working on a strategy with the IOM Government such that with the aid of a loan from the UK, the IOM Government could guarantee the liquidity of KSF IOM such that it could recommence normal commercial operations that would lead to a number of viable options for the bank.
  13. Can we have a full breakdown of the loan book in percentage terms (type & value)
    • %:- based on shares, of the share based loans what other collateral do these loans have,
    • %:- property loans (residential / commercial),
    • % :- other mortgages shipping (private / commercial), aircraft etc,.
    • %:- personal loans,
    • %:- commercial loans.
    • The total % interest only loans.
  14. The priority given to EY on their appointment was the transfer of depositors to ING. Have EY provided MS with any information on the status of their work?
  15. Is it correct that EY will only be able to give attention to other activities when they have completed the ING transfer and hence any meaningful action to determine likely repayments to non-retail depositors, such as KSF IOM, will not take place until then?
  16. Are you (or PWC) working on a strategy with the IOM Government such that with the aid of a loan from the UK, the IOM Government could guarantee the liquidity of KSF IOM such that it could recommence normal commercial operations that would lead to a number of viable options for the bank.

Bond Holders

  • Anonymous
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  • Sun, 25/01/2009 - 16:19

Pls excuse me if this has been brought up recently as I have been out of the picture for some time ....but it seems that under the proposed SoA scheme Bond Holders might be left out in the cold ( Max 20K for any one Bond)
Can we get some clarification on this issue that would change everything if this is the case .


Chipmunk,

  • Anonymous
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  • Sun, 25/01/2009 - 17:20

Chipmunk,

This clarification should be sought from the FSC who administer the scheme - not the LP as he is not the one running the schemes for compensation.

I'm not sure though what you are referring to as the details of the SoA that the IOM Government want to propose has not been released yet.


Bonds..again

  • Anonymous
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  • Sun, 25/01/2009 - 18:21

Thanks Frog for clarification...

I was referring to a number of posts today on this site ref the SoA stating from 'reliable sources' that the SoA scheme will still treat Bond holder the same way as a Compensation package ie max £20K for any one bond, which of course would be useless for the thousands of bond holders...


I'm sending the questions off to Mike Simpson now.

  • Anonymous
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  • Fri, 23/01/2009 - 15:24

The questions for the Monday call are:

Previous Questions
1. DAG website address on bank site

A: This will be done also in the next couple of days.
- The site information cannot be found on the site – can you provide its location?
2. What would be the total amount, which the DCS would be obliged, under the current scheme rules, to pay out to all eligible KSFIOM depositors in the (hypothetical) event that the bank had no assets to distribute?
Today’s Questions
3.
4. What was the value of the loan for which the JJB shareholding was used as collateral? (Note the LP seized 58M shares, worth £5.1M and were worth approximately 13 times that value back in September)
5. What are the prospects of further recoveries in respect of this debt?
6. What is the status of the Moratorium that the Icelandic Government has put in place, which prohibits action against Khf?

  1. In the last round of questions you state the in-flight monies form part of the exposure to KSF UK - can you confirm these monies will be returned as a bulk deposit at full face value or will they be treated the same as the other up-streamed funds e.g. possibly only returned as a % of the total thereby disadvantaging all creditors to KSF IoM.
  2. Is the LP considering legal action against the directors of the bank in regards to breaching their fiduciary duties with respect to: 
1. Allowing such a large deposit to go to KSF UK unsecured
2. Granting ridiculous loans such as the loan for the JJB purchase using shares as collateral.
  3. The KSF UK Creditor Committee met on 19 January 2009. Does he have any access to information, which was provided to the CC, and if so does he have any update on the payment of any dividend to KSF IOM from KSF UK?
  4. Repeat question from previous call: 'When will we know how much money KSFIOM will be able to get back from the UK or at least a rough idea?'
  5. Aiden Doherty advised us that the loan book consisted only of high quality loans. Please ask as follows:
    • Are there loans in the book, which are now considered to be at risk of substantial under-recovery? 

    • If so what is the estimate of the total amount of under-recovery if the loans are allowed to run to term.
  6. Were there any large movements of savings or shares from KSF (IOM) in the proceeding 12 months by any of the Directors of KSF (IOM)?
  7. On the 8th of October 2008 how many KSF IoM accounts were ex-Derbyshire?
  8. How many of these ex-Derbyshire accounts were fixed term accounts, which had not reached term?
  9. Please confirm that all accounts have had statements issued as of 8th Oct 2008?
  10. From the statements issued how many depositors have returned their conformation details?
  11. Will PwC publish the number of unclaimed accounts, their value and what will become of the funds therein?
  12. Are you (or PWC) working on a strategy with the IOM Government such that with the aid of a loan from the UK, the IOM Government could guarantee the liquidity of KSF IOM such that it could recommence normal commercial operations that would lead to a number of viable options for the bank.
  13. Can we have a full breakdown of the loan book in percentage terms (type & value)
    • %:- based on shares, of the share based loans what other collateral do these loans have,
    • %:- property loans (residential / commercial),
    • % :- other mortgages shipping (private / commercial), aircraft etc,.
    • %:- personal loans,
    • %:- commercial loans.
    • the total % interest only loans.
  14. The priority given to EY on their appointment was the transfer of depositors to ING. Have EY provided MS with any information on the status of their work?
  15. Is it correct that EY will only be able to give attention to other activities when they have completed the ING transfer and hence any meaningful action to determine likely repayments to non retail depositors, such as KSF IOM, will not take place until then?

Questions for Mike Simpson so far....

  • Anonymous
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  • Thu, 22/01/2009 - 20:00

Dear all,

Here are the list of questions so far for the call on Monday 26th January 2009 at 4pm GMT. There is still time to add questions...

Previous Questions
1. DAG website address on bank site
A: This will be done also in the next couple of days.
- The site information cannot be found on the site – can you provide its location?

  1. What would be the total amount, which the DCS would be obliged, under the current scheme rules, to pay out to all eligible KSFIOM depositors in the (hypothetical) event that the bank had no assets to distribute?

Today’s Questions
3. What is the exposure to KSFUK assuming full setoff?
4. What was the value of the loan for which the JJB shareholding was used as collateral. (Note the LP seized 58M shares, worth £5.1M and were worth approximately 13 times that value back in September)
5. What are the prospects of further recoveries in respect of this debt?
6. What is the status of the Moratorium that the Icelandic Government have put in place which prohibits action against Khf?

  1. In the last round of questions you state the in-flight monies form part of the exposure to KSF UK - can you confirm these monies will be returned as a bulk deposit at full face value or will they be treated the same as the other up-streamed funds eg possibly only returned as a % of the total thereby disadvantaging all creditors to KSF IoM.
  2. Is the LP considering legal action against the directors of the bank in regards to breaching their fiduciary duties with respect to:

  3. Allowing such a large deposit to go to KSF UK unsecured
2. Granting ridiculous loans such as the loan for the JJB purchase using shares as collateral.
  4. The KSF UK Creditor Committee met on 19 January 2009. Does he have any access to information which was provided to the CC and if so does he have any update on the payment of any dividend to KSF IOM from KSF UK?
  5. Repeat question from previous call: 'When will we know how much money KSFIOM will be able to get back from the UK or at least a rough idea?'
  6. We were advised by Aiden Doherty that the loan book consisted only of high quality loans. Please ask as follows:
    • Are there loans in the book which are now considered to be at risk of substantial under-recovery.

    • If so what is the estimate of the total amount of under-recovery if the loans are allowed to run to term.
  7. Were there any large movements of savings or shares from KSF(IOM) in the proceeding 12 months by any of the Directors of KSF(IOM)?
  8. On the 8th of October 2008 how many KSF IoM accounts were ex-Derbyshire?
  9. How many of these ex-Derbyshire accounts were fixed term accounts which had not reached term?
  10. Please confirm that all accounts have had statements issued as of 8th Oct 2008?
  11. From the statements issued how many depositors have returned their conformation details?
  12. Will PwC publish the number of unclaimed accounts, their value and what will become of the funds therein?
  13. Are you (or PWC) working on a strategy with the IOM Government such that with the aid of a loan from the UK, the IOM Government could guarantee the liquidity of KSF IOM such that it could recommence normal commercial operations that would lead to a number of viable options for the bank.

Question 7 - I look forward

  • Anonymous
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  • Sun, 25/01/2009 - 10:18

I look forward to the answer to question 7. Surely if the answer is yes - we have caught them fair and square.


Me too

  • Anonymous
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  • Mon, 26/01/2009 - 08:42

I put it forward because if the answer is 'yes' or the answer is not forthcoming, then we know that the Directors were actively advising depositors to sit tight when they themselves didn't believe their own words. It strikes at the very core issue of trust in the Directors, especially those with a very obvious conflict of interest.

I should have also asked if the Directors had any current loans through the bank and were these likely to be 'set off' under any liquidation. Maybe that one should be left for another week.

SG


Breakdown of the loan book

  • Anonymous
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  • Fri, 23/01/2009 - 02:13

Sure I saw it somewhere, but can't find it, there is a similar question on the list with respect to potential undervalue loans however lets be more specific,

Can we have a full breakdown of the loan book in percentage terms (type & value) %:- based on shares, of the share based loans what other collateral do these loans have, %:- property loans (residential / commercial), % :- other mortgages shipping (private / commercial), aircraft etc,. %:- personal loans, %:- commercial loans.

& the total % interest only loans.


MLRO

  • Anonymous
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  • Fri, 23/01/2009 - 01:32

Could Mike Simpson kindly confirm the name of the banks Money Laundering Reporting Officer (MLRO) for all of last year 2008? Could Mike Simpson confirm whether ultimate responsibile (as a vicarious liability) lies with the Directors in respect of any prosecution?


FROG/MLRO

  • Anonymous
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  • Sun, 25/01/2009 - 10:09

Frog, following a converstaion with someone who knows about these things, kindly withdraw the question regarding MLRO etc - it is not in the groups best interests just yet to bring this to the fore.
Thx


I see where you are going with this, Cpt

  • Anonymous
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  • Fri, 23/01/2009 - 02:39

I see where you are going with this, & over the last 24 hrs probably thinking along similar lines, but can't find the original posts on the subject - my emails open.


In my experience of dealing

  • Anonymous
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  • Fri, 23/01/2009 - 02:54

In my experience of dealing with Teflon Incompetents, once you can get the ball rolling, then the whole lot will collapse around their ears.

From what I have read, there is the very real possibility of forcing PWC into auditing KYC data, and then having to force the FSC to take action against the compliance officer.

KSF knowingly opened customer accounts using identity proofs that wouldn't have procured a library ticket. They failed in their duty of care to existing customers and also the FSC by doing so. In doing so there may well be hundreds of accounts that should not have been opened, possibly also mortgages, to the detriment of existing customers.

Old Ramsey Peel is insistant that the directors should be answering as many questions as Simpson, and I agree with him.


captain mainwaring..

  • Anonymous
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  • Fri, 23/01/2009 - 05:28

I dont even have a proper account, holding my funds without proper accounts? placed on the 6th didnt have time to open correctly.this whole thing is disgusting like they all are. Ramsey peel is very right they should all be held accountable, all directors. How did we all get it so wrong?.


We didn't. Lets stop peeing

  • Anonymous
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  • Fri, 23/01/2009 - 06:02

We didn't. Lets stop peeing about here. I reckon we can drag up a good bit of muck over this and will be email PWC today to ask for the name of the official responsible for this. I am hoping he will say that the responsibility falls with the directors.

Suggest anyone interested in making a complaint makes a timeline statement (without histrionics) and checks exactly what was submitted to the bank, and if you have received it back, see what the bank has stamped on it. Particulalry important is the endorsement of any legal document, who do it and what does the endorsement say?

Let's get all this together and hit him with a concentration of complaints, copied to the FSC who knew exactly what level of compliance KSF were applying.

The IoM in some shape or form will take us seriously.


Oh that's easy

  • Anonymous
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  • Fri, 23/01/2009 - 12:12

Suggest anyone interested in making a complaint makes a timeline statement (without histrionics) and checks exactly what was submitted to the bank, and if you have received it back, see what the bank has stamped on it. Particulalry important is the endorsement of any legal document, who do it and what does the endorsement say?

September 2008

application 10th
submit docs by email 11th - hard copies mailed
account open 15th
deposit made 17th

No documents stamped
No Legal documents save bank statemenst sent, no endorsements.


Right, thats the first one,

  • Anonymous
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  • Fri, 23/01/2009 - 12:23

Right, thats the first one, who is next?
I'd suggest that yours and mine will be enough to start the ball rolling. I think we can cause a good deal of excitement here.

I think it will be worthwhile drafting a standard email requesting Officer details and making a formal complaint


? Cpt start a new post

  • Anonymous
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  • Fri, 23/01/2009 - 13:02

Probably best if we start a new forum heading for this instead of carrying on within PWC question list -


Contact---

  • Anonymous
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  • Fri, 23/01/2009 - 05:13

In response to one of my previous posting you said you'd send me a way of contacting you directly. As far as I`m aware I didn't receive any post. Would you resend?


re- In my experience of dealing

  • Anonymous
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  • Fri, 23/01/2009 - 03:01

I agree with you there, but in addition my thoughts were also the FSC had a duty of care to ensure the bank operated within the regulations, if it didn't then they must also be "at fault"..

Tried getting this through on a new subject a couple of days ago but very little response, N Rock - Lehman's, all were and still are being pulled over the coals -- IoM -- silence.


in your experience

  • Anonymous
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  • Fri, 23/01/2009 - 12:32

skintagainnow : possible breach of statutory duty, since they likely do not owe a duty of care in negligence (for example, in negligence, it has been held that police do not owe a duty of care to a member of the public to prevent him from being the victim of a crime). However, please note that the FSC has a degree of statutory immunity.


duty of care

  • Anonymous
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  • Fri, 23/01/2009 - 13:13

As a regulatory body they must have a duty of care to ensure the regulations and laws are upheld, whether that be a duty of care to the IoMG to ensure compliance not in the least to the anti money laundering regs, IoMG is supposed to uphold and claim they comply with all current legislation, someone or a body certainly failed in their duties.

It's a big can of worms, once opened no one would be safe from scrutiny.


duty of care

  • Anonymous
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  • Fri, 23/01/2009 - 14:04

Any such duty of care would probably have to be statutory, since as I have indicated above it is unlikely to be in negligence. See "equitable life" and FSA, although beware that no court has held that FSA is liable for the failings identified by the ombudsman.

Negligence is not a straightforward area of law. Establishing a duty of care is a non-negligible hurdle. Bald assertions that "they must have a duty of care" are not in the least meaningful. In a novel case, it is essential to establish by reference to existing case law in negligence that such a duty exists. For example, do you think that the fire brigade has a duty of care in negligence to respond to an emergency, because in law it does not. However, if there is a statutory duty (which is one set out under statute rather than one that exists in negligence), and it has been breached, there is little room for argument.


FSC

  • Anonymous
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  • Fri, 23/01/2009 - 12:24

I believe it does, and this may open a can of worms they could well do without.


New Deemster?

  • Anonymous
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  • Fri, 23/01/2009 - 13:34

I am new to all of this but from what I have read and been told it appears that the only option that investors have is to request that a new Judge, or Deemster is appointed to preside over this.

Why doesn't your/our body request that the Isle of Man Government request that someone experienced in these matters, and who is independant of the Isle of Man Government is appointed.

The current chap is employed by the Isle of Man Government, surely there is once more conflict?

I can not believe that any responsible Government would allow someone on their payroll to take a decision on something so serious that will effect all of their citizens.

Food for thought?


New Deemster?

  • Anonymous
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  • Fri, 23/01/2009 - 13:48

The Deputy Deemster is a judge. It is one of the unfortunate aspects of going to court (anywhere) that you do not get to choose your judge! Sometimes you can get a judge to recuse himself, but it is uncommon and there needs to be a good reason.


New Deemster?

  • Anonymous
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  • Fri, 23/01/2009 - 14:00

Then elgee, come up with a good reason, you sound like a seasoned campaigner with a legal background.

You will know what will be accepted.


New Deemster?

  • Anonymous
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  • Fri, 23/01/2009 - 14:07

To my knowledge there does not exist a good reason in this case. Normally the judge would have had to have shown some prejudice, and this one has not.

I think I can assure you that this is a blind alley.


New Deemster?

  • Anonymous
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  • Fri, 23/01/2009 - 14:11

As the leader of the action group, wouldn't it be prudent to at least look into it?


Compensation Currency

  • Anonymous
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  • Thu, 22/01/2009 - 21:00

Question for M Simpson: 26/01/09

As far as I am aware KSFIoM accepted deposits in Sterling, Euro and Dollars.

If and when are deposits are eventually to be returned to us why are they not being returned in the denomination in which they were originally deposited?


Dear Frog, I second the above

  • mikepapa
  • 10/10/08 n/a (free)
  • a depositor
  • Offline
  • Thu, 22/01/2009 - 22:02

Dear Frog,

I second the above question.

Can you ask MS specifically why any dividend pay out will not be made as a
% of deposit in currency of deposit?
If not, this may lead to preferential treatment of depositors, and as far as I am
aware, KSF IoM was 'sold' as an International Bank not purely a GBP Bank!

Kind regards,

Mike


This was discussed on the

  • Anonymous
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  • Thu, 22/01/2009 - 22:08

This was discussed on the last call. The payments will be made in GBP and apparently there is precedent for this. He was not budging on payments in Sterling.


Conversion and fairness

  • Anonymous
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  • Fri, 23/01/2009 - 00:06

It remains to be seen if the precedent applies in our case, as the exchange market movement might have been different or insignificant when the precedent was set.

The currency of payment is immaterial so long as the exchange rate is fair. If there is $100,000 in my account and the distribution rate is 75%, I want $75,000 in my nominated account after the conversion and transfer. If I get less, I will take a legal action and encourage others to do the same.


Conversion and fairness

  • Anonymous
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  • Fri, 23/01/2009 - 11:35

jkk
Yes this is correct and acceptable solution.
Exchange rates of 9 Oct as heve said by IOMG are not fair at all and therefore can not be accepted. The exchange rate should be date of actual LIQUIDATION as was said by LP during the previous call, and not the date of SUSPENTION that is 9 Oct . If it is not possible then the refund must be in the currency of Deposits


conversion and fairness

  • Anonymous
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  • Fri, 23/01/2009 - 01:34

you would have my backing on legal action.

As to the comment: if the dollar was now $3 : £1...thats not the point. As jkk said ....If there is $100,000 in my account and the distribution rate is 75%, I want $75,000 in my nominated account. Personally, I dont want GBP! I deposited $ and Euro and if the distribution is equitable, the same should be returned.


Can I ask you, would you

  • Anonymous
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  • Fri, 23/01/2009 - 00:51

Can I ask you, would you request this if the dollar was now $3 : £1 and the liquidator offered to pay you out in USD? of course you wouldn't, no one would. So, bearing in mind the likelyhood of a severe dollar crash at some point during this process, be careful what you wish for.

Have you asked the liquidator what proportion of the loan book consists of dollar mortgages? Is Simpson going to apply the same logic to redemptions from the loan book?

One assumes that Simpson has already purchased GBP with the dollars he has, why not ask him? If he hasn't, why hasn't he?


Exchange rates

  • Anonymous
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  • Fri, 23/01/2009 - 12:01

I understand from FROGs comment that Mike Simpson would use the date of liquidation to convert all currencies to UK pounds. Hence the proposed SoA leave the foreign currency holders at a severe disadvantage if it uses the 9th of Oct. Either the repayment should be made in the currency of the accounts or the exchange rate calculation date should be the same as the one Mike Simpson would use in a DSC schenario. Otherwise you are likely to get a massive amount of resistance to the SoA from all foreign account holders who might want to go with the DSC instead.


$ and Euro

  • Anonymous
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  • Fri, 23/01/2009 - 18:40

Once again I am making this comment...I dont want GBP!. I deposited in S and Euro and whatever % is finally paid out should be in $ and euro.


Well it was challenged on the

  • Anonymous
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  • Fri, 23/01/2009 - 18:42

Well it was challenged on the last call - and it wasn't an option on the liquidation it seems.

I agree with you BTW


Dear jkk, I agree

  • mikepapa
  • 10/10/08 n/a (free)
  • a depositor
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  • Fri, 23/01/2009 - 00:15

Dear jkk,

I agree entirely.

Mike


Conversion and fairness

  • Anonymous
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  • Fri, 23/01/2009 - 00:34

Jkk, if you enter into the SoA (which is a contractual arrangement), what do you think will be your cause of action in the threatened legal proceedings (and against who) if its terms are complied with?

I am not trying to be awkward, just informative, but (i) the "precedent" to which you refer would be irrelevant if you had entered into an agreement and (ii) as with any precedent, you need to find out what case it refers to and read it in full before making any assumptions at all as to whether it applies and whether it is on all fours with the facts of your case.


Conversion and fairness

  • Anonymous
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  • Fri, 23/01/2009 - 00:58

In case of SoA, basic parameters of the arrangement such as currency of payment, applicable exchange rates if any, payment schedule etc would have to be clearly spelled out before SoA is put to vote.

In other words fairness would have to be built into the agreement without regard to standard practice in liquidation or any precedents.


Conversion and fairness

  • Anonymous
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  • Fri, 23/01/2009 - 01:41

In that case, if you seek to make it a condition of the SoA that foreign currency accounts are exchanged according to your prescription and you are successful, then it would be complied with and there would be nothing for you to sue over.

If, on the other hand, for whatever reason such a prescription is not incorporated into the SoA, and the SoA is agreed by a majority vote as directed by the court, then I think that you would have no cause of action over which to sue.


Conversion and fairness

  • Anonymous
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  • Fri, 23/01/2009 - 02:01

True. I mentioned legal action in reference to liquidation on unfair terms, not SoA.


Questions for Mike Simpson so far....

  • Anonymous
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  • Thu, 22/01/2009 - 20:02

Edit


Questions for Mike Simpson so far....

  • Anonymous
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  • Thu, 22/01/2009 - 20:03

Edit