Replies from MPs - Post them all here

  • Anonymous
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Posted: Wed, 15/10/2008 - 20:31

On Monday I sent a letter (the good old-fashioned way) to my MP, Mark Field who is Conservative member for the Cities of London and Westminster. Today I already got a reply, also by regular mail. He must have written and sent his reply the day he received mine, which is impressive. His reply, in full, reads:

"Thank you very much for your recent letter regarding the difficulties of British depositors with Kaupthing, Singer and Friedlander (KSF) in the Isle of Man.

I was very sorry to hear of your situation and the problems that you are facing due to not being able to access funds that you had trusted KSF with. I do appreciate that this must be a difficult and worrying time for you particularly as you are currently unemployed.

I have now written to both Alistair Darling MP at the Treasury and Jack Straw MP at the Ministry of Justice informing them of your current circumstances and asking them to provide as much assistance and advice as possible.

Thank you for taking the time and trouble to write. I shall, of course, be in contact as soon as I hear back from the Treasury or Ministry of Justice

With kind regards

Mark Field MP

I am impressed with the tone and speed of his response. I see that other MPs have been assisting other depositors on this site and that they have also referred questions to the Treasury, so hopefully the Treasury should start to realise this crisis has impacted a wide range of British and other depositors. I have also written to Yvette Cooper at the Treasury and Lord Bach at the Ministry of Justice.

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first posting on this thread over one year ago - what happened?

  • Anonymous
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  • Tue, 27/10/2009 - 22:49

What happened to the idea of a cross party group of interested MPs?

reply from HM Treasury

  • Anonymous
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  • Tue, 22/09/2009 - 16:27

I received a letter from HM Treasury (from Paulette Wright) dated 7th September which I have only just read having been away from home for a month. It is a response to my letter to the PM of 2 April, 2009 which was passed to Treasury for a reply. There is a four and half page A4 attachment headed Kaupthing Bank HF, with a subtitle KSFIOM and set out as question and answers. I have no doubt this attachment has been sent out to others although I see no mention of it recently in this thread. In effect it says that the responsibility for KSFIOM is that of the the Isle of Man. I do not know how to copy it to the thread but if it is of any use to the DST I will send it to them if an address is supplied.

I found this account quite depressing as it appears to give us no means of countering what is said, and it makes me wonder if there is any point in writing further to government departments (my last letter to Ministry of Justice regarding an independent inquiry and other issues remains unanswered). Although I can see that there are some MPs who are willing to press on for their constituents, overall there appears to be little interest amongst them. I do not have an MP so I cannot command any personal interest. If DST still think it is worthwhile writing to all MPs, I think they should indicate which issues are worthwhile pursuing. Going over old ground when the government will give no ground seems to be pointless.

Reply from Treasury

  • Anonymous
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  • Tue, 22/09/2009 - 22:05

Hi jmf,

I have received the same "guidance" notes from both Paulette and my UK MP. They are probably the same as yours.

Do not dispair there are counterpoints. I'm creating a reply which I believe will address many of the points made.

Briefly my points are:

1) Non intereference in other countries? - what about Landsbanki which whilst operating in the UK was regulated by the Icelandic FME not the FSA?

2) Admin process. What about Dave Whelan (who as far as I can tell was probably not a retail depositor and certianly not an edge depositor) and stockcube? Both had the chancellor intervene on their behalf.

3) IOM independent? Can't believe that the services the Uk provides to a crown dependency are obligation free. There's also the Kilbrandon Report.

4) Seizure of KSF IOM assets: Had a disasterous effect on the bank and forced its closure. It might still be trading had this money been returned. Ruining thousands of people lives.

5) The crap SOA, how and why it was rejected and the costs imposed on depositors.

6) The lying chancellor and the FOI that, as far as I'm concerned, proves it.

There will probably be others.

I'll post it on my blog once I'm happy with it.

Regards, TonyC

Reply to Treasury

  • Anonymous
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  • Wed, 23/09/2009 - 15:55

Hi tonyC,

Thanks for your encouraging words. While I was away I did not have a chance to keep up with the site but I see now that some of the DAG are hoping to get together a small group of sympathetic MPs to work with us. This may give us more of a chance of having our grievances aired.

You have great patience. I look forward to reading your blog when you have your response completed.

Kind regards, jmf

MP reply

  • Anonymous
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  • Fri, 10/07/2009 - 03:28

Got this today from Barry Sheerman, MP for Huddersfield:

Dear Mr *****,

Thank you for your email. I sincerely apologise for the delay in my response.

This may not be much of a condolence, but I tabled a question today with the Treasury requesting that they pressure the Isle of Man Government not to charge the depositors for the failed Scheme of Arrangement against KSFIOM.

You and the other depositors of KSFIOM have my deepest sympathies and I will continue to do what I can to assist you in parliament.

Yours sincerely,

Barry Sheerman

Response by HMT to Barry Sheerman

  • Anonymous
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  • Wed, 15/07/2009 - 09:34

Barry's question and Treasury response have just appeared on They Work For You website:

Barry Sheerman did as he promised - and got short measure, as always, by Ian Pearson. He also brought up the question of the Derbyshire (rebuffed again). Unfortunately I feel Pearson may be on firmer ground here as these ARE essentially IoM questions. It was Derbyshire (IoM) who sold out to KSF, not - as such - Derbyshire BS (though they were the parent).


  • Anonymous
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  • Wed, 15/07/2009 - 11:24

On referring to the Derbyshire you say Pearson may be on firmer ground as they are essentially IOM questions. Then you say "(though they were the parent)" in brackets. This fact is PIVOTAL, the Derbyshire were the parent bank of Derbyshire IOM. They would have been involved in the negociations and the sale just as they were involved to the extent they originally gave their parental guarantee. For this reason it would have been more appropiate to put this in BLOCK CAPITALS.

@peter and louise - Derbyshire

  • Anonymous
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  • Wed, 15/07/2009 - 12:19

Sorry I didn't use BLOCK CAPITALS (can't think of everything!) - though I'm not sure it would have changed anything. I trust you don't think I was trying in even the smallest way to defend Ian Pearson! I certainly WAS NOT; I was just pointing out that they (HMG) may find it easier to brush this aside than their responsibility in the whole debacle (which they also continue to deny).

I too am ex-Derbyshire and FURIOUS with them for selling us down the river to KSF. Other aspects have obviously taken precedence until now, but I am encouraged to see that DAG/DSTare now actively pursuing this.


  • Anonymous
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  • Wed, 15/07/2009 - 11:40

The DST has instructed Edwin Coe to obtain an opinion on the Derbyshire issues, both in respect of the special cases of which we are aware (those with particular evidence of misreps being made to depositors) and in the general case. Funds will be used in the first instance (opinion only) from the DST general legal funds, on the basis that incremental actions of this sort on behalf of small groups of depositors cumulatively benefit the body of depositors as a whole, although there may be a need at some stage to raise funds from the Derbyshire depisitors specifically to finance any actions brought on their behalf (obviously that is not my decision).

There is little doubt in my mind that all Derbyshire depositors are a special case of KSFIOM depositor, as indeed are the bondholders. It remains to be seen whether the former have their own special causes of action aganst third parties, although I once again emphasise that there is no need to establish that they have a cause of action against the bank itself, because they have an undisputed claim against the bank in any event.

If my memory serves me well

  • Anonymous
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  • Wed, 15/07/2009 - 12:59

...but, at 55 years old, I can't always rely on it! I seem to recall that, as a longstanding Derbyshire investor, I was never given the option to say "thanks but no thanks" to having my lifesavings handed over to Krapthing's bank. In fact, I believe I was denied access to my money while the sale took place. Denying me access to my lifesavings seems to have been Krapthing's M.O. all along. In Sept. 2008 I attempted to access my account via the internet and was constantly thwarted by techie problems. When I sent a snail mail to withdraw my money, the lady I spoke to went to great lengths to reassure me that all was well. In hindsight, it was definitely a case of "thou doth protest too much". Count me in for continued contributions to the fighting fund to make sure that NO stone is left unturned looking at the dodgy dealings that have brought us to this point.

Response by HMT to Barry Sheerman

  • Anonymous
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  • Wed, 15/07/2009 - 09:46

Whilst I agree it is "not possible" for HMT to intervene in the decisions made by the Manx regulator, and in any event it is too late for them to do so, it is certainly possible for HMT to have discussions with the Manx government about what can be done at this stage to help Derbyshire depositors and indeed all depositors. I understand that IoMG is not talking to anyone at present and rebuffing approaches made to it.

Question from Mark Williams in Parliament

  • Anonymous
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  • Wed, 15/07/2009 - 08:27

From the They Work for You website (

Mark Williams (Ceredigion, Liberal Democrat):
To ask the Chancellor of the Exchequer if he will establish an inquiry into the events leading to and following the failure of Kaupthing Singer and Friedlander (Isle of Man); and if he will make a statement.

Sarah McCarthy-Fry (Parliamentary Secretary, HM Treasury; Portsmouth North, Labour):
Kaupthing Singer and Friedlander Isle of Man (KSF IOM) is not a subsidiary of KSF in the UK, but of the Icelandic parent company. Oversight of KSF IOM is the responsibility of the Isle of Man's Financial Supervision Commission and therefore the question of a review would be primarily a matter for the Isle of Man Government.

My comment (Annotation):
"As with previous Treasury responses to questions about KSFIOM, this reply avoids the real issue. Yes, the oversight of KSFIOM is the responsibility of the IOM FSC. BUT - and this is a very big but - the events leading to its failure undoubtedly began in the UK when KSFUK was put into administration with no warning to the FSC and apparently with no consideration of the effect this would have on its sister bank in the IOM and its hapless depositors. So an inquiry in the UK seems totally justified."

On reflection I could have added that KSFIOM did not 'fail' but was brought down by the actions of HMG.

Could others add more comments? You have to register, but it's quite simple and you can use a pseudo if you wish (though they say they prefer real names where possible).

Combined action - Fiona Salem

  • Anonymous
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  • Wed, 15/07/2009 - 09:39

I got a kind response from Paul Rowen - who was involoved for Christies saying he would write to the Minister for us - but of course we know what response that would bring!
I also got another message from Fiona Salem - not answering any of my questions and referring to lots of totally irrelevant stuff.
What I think we need to do is produce a message from DAG to all MP's, with a copy of all our correspondence with MoJ and Treasury, demonstrating how we - as UK citizens - have asked proper questions to which we - ina democratic society and given we have lost our life savings due to HMG's actions - could expect to receive a real answer - and in return have received no answers at all.
This should be sent also to all the major newspapers.
How could this be organised?

Reply from Henry Bellingham MP

  • Anonymous
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  • Thu, 18/06/2009 - 14:29

Subject: RE: Iceland
Date: Tue, 16 Jun 2009 13:54:20 +0100
From: BELLINGHAMH(?)parliament [dot] uk
To: xxxx

Further to my acknowledgment ,thank you very much indeed for contacting me in connection with the above.

Yes, I agree with you, it is obviously good news that Iceland has now agreed to repay the loans that we used to rescue the retail depositors in Icesave.

Of course, the difference between Icesave and the other onshore retail banks is that the UK Government felt that there was an obligation to retail depositors. In the case of KSFIOM we are talking about offshore jurisdiction and that is why the Government is going to require a bit more persuading.

My own view is that it is highly unlikely that they are going to agree to anything until we know exactly what the shortfall on the administration is going to be. I then envisage a campaign to persuade all three governments to come up with further compensation.

Myself and other MPs are pushing the government for a public inquiry and we are also asking for a meeting with Lord Myners, the relevant Minister.

Obviously we will be keeping up the pressure to the best of our ability.

Kind regards,

Henry Bellingham

Andrew mackay

  • Anonymous
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  • Wed, 03/06/2009 - 07:10

Thank you for your email which I can well understand your frustration. Please rest assured we are doing everything possible here at Westminster to resolve this matter although it is a hard grind.

Let us keep in close touch

With best wishes


Patrick McLoughlin

  • Anonymous
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  • Mon, 01/06/2009 - 18:14

'Dear xxxxx, thank you for your message. As you know from our earlier correspondence, I (and the Conservative Party as a whole) have been pressing the government for an enquiry since the crisis began, but the government continues to resist the idea. I will of course send your message to the Treasury, although as you will no doubt recall, it can take a very long time for me to get an answer. As soon as I do so, I will send it to you. Yours sincerely, Patrick McLoughlin '

I only emailed yesterday, using the template provided, so I'm pleased to, again, receive such a prompt reply. I look forward to the Treasury's response!

Neil Turner ( Dave Whelans MP)

  • Anonymous
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  • Tue, 02/06/2009 - 22:44

Dear xxxx

I am sorry you are caught in the Kaupthing bank collapse. If you are not my constituent, the Parliamentary rule requires me to pass on your issue to your own MP. Whether or not they are standing down at the next election does not prevent them from representing their constituents until then. He/she should still hold Advice Surgeries and I would advise you to visit them at their next one.
I was able to intervene on the JJB issue because its HQ is in my

I hope you are able to get the problem resolved,

Best Wishes,

Neil Turner MP Wigan

Whelan funds release - still not clarified?

  • Anonymous
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  • Wed, 24/06/2009 - 17:05

Did we ever get to the bottom of this? I have been corresponding with HMT but to date no explanation forthcoming. Anybody from Wigan who can take up directly with Neil Turner (MP Wigan who admitted he intervened) ????

looking for contact list of MPs

  • Anonymous
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  • Wed, 27/05/2009 - 17:58


I am looking for the contact list of MPs – I see we are going to be asked to contact them all again.

I have just managed to work out turbomailer – which will enable me to mail out personalized e-mails to a large list.

However I would like to track down a list in excel of MPs – preferably 3 columns – e-mail, first name, last name.

Are you aware of anyone who has such a list they would be prepared to share.



nadine dorries

  • Anonymous
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  • Fri, 22/05/2009 - 11:11

Anyone here from Mid Beds?

I see the MP for Mid Beds Nadine Dorries is moaning that the expenses scandal is causing some Mps to be suicidal.

Maybe she would like to know how it is to lose her life savings ( not just her second home allowance )

dorriesn(?)parliament [dot] uk

Might I suggest adding

  • Anonymous
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  • Mon, 01/06/2009 - 18:53

Might I suggest adding something along these lines to the letter to MPs penned by Icecrusher and DST.

It is particularly gauling for many to listen to an MP, such as Julie Kirkbride in her desperate plea for clemency regarding her expenses. She apparently had to milk the MPs' expenses system because she was a working mother. "It's not about profit, it's about keeping the family together," she is quoted as saying. It’s a lamentable statement when considered against the thousands, like me, that are struggling to keep a roof over our families head because of my funds have been taken from my reach. You will, I am sure, understand that I and others have little sympathy for the MP in question when legitimate finds of mine have been appropriated by this same Governments actions.

Reply from Fabian Hamilton, MP

  • Anonymous
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  • Tue, 02/06/2009 - 13:02

This is the reply to my letter of 31 May 2009 which I partially posted (added my own introduction) under Ice Crushers template letter, he seems to have been insulted by it, I can't see why!

Dear Ms XXXXX,

The last time I replied to you, and other investors in KSFIOM, I found myself pilloried and abused on some strange website. I have huge sympathy for your plight and the plight of so many others who have lost everything, but it really doesn't help me and my colleagues when you tell us how appalling and criminal we all are and then ask for our help!

I DO understand what you must be going through, never mind what rubbish you are reading about MPs in the press. Insulting me and others is not going to win you more sympathy and help.

However, leaving all this aside, I really do want to see justice for you. The question is what can best be done to help? I have already made representations to the Chancellor both personally and in writing. I have also raised this matter with the Icelandic Government, many of whose members I know personally, however, after previous correspondence with you and other KSFIOM investors I find that my attempts to get the Icelandic Government involved are ridiculed and dismissed on this website I mentioned.

I will arrange to meet a Treasury Minister as soon as possible to try and find out exactly what the UK Government is doing and what hope there is for the investors and depositors in KSFIOM to get their money back as soon as possible. I will also pursue the Icelandic Government as well, even if you and others think this is not the way forward.

As I said, I very much understand your anger and bitterness at the way in which you believe the UK Government has let you down, and it is imperative that you do receive the justice you deserve.

Finally, you said that I would have you on my doorstep if I passed this email on to a 'subordinate'. I have not done so, but nevertheless you are most welcome to come and see me in Leeds or in London if you want to talk about this further. Sometimes, personal contact is far better than correspondence, so if you'd like to meet when you're next in the UK (I know you live in Cyprus) please contact me to arrange a suitable time and date.

Yours sincerely,

Fabian Hamilton
Labour Member of Parliament for Leeds North East

House of Commons
London, SW1A 0AA

Telephone: 020 7219 3493
Constituency: 0113 249 6600
Fax: 0113 235 9866

Nadine Dorris MP

  • Anonymous
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  • Wed, 27/05/2009 - 18:05

Yes she was interviewed on Jeremy Vine last week - I emailed the programme only to be told too many listeners had emailed with their comments to add mine. I emailed M Dorris but as yet have failed to have an acknowledgement of how the MP's have treated us as KSFIOM depositors when she is expecting M P s to be treated humanly - do they know the meaning of the word??


  • Anonymous
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  • Fri, 22/05/2009 - 12:18

At least they have 1, 2, 3, Houses... as opposed to my 0... My Heart Bleeds for them they're all a "Bunch " a" Bandits"...
They SCREWED UP we need to get some fresh Blood in the House!!!

Nadine Dorries MP

  • Anonymous
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  • Fri, 22/05/2009 - 11:20

Excellent posting by bellyup, I suggest we all use this to maximum advantage, here is my contribution which I have just emailed to Ms Dorries:

"I am not sure how accurate the reporting has been but I read this morning that you have recorded concerns over the "plight" of MP's who are approaching suicide in the current debacle over the expenses scandal.

My wife and I are innocent victims of the collapse of Kaupthing, Singer & Friedlander Isle of Man and have enduded the massive loss of the entire proceeds from our house sale last year, since October 8th 2008.

Trust me when I say that this has been the most difficult thing that we have ever had to endure and to now hear MP's bleating like this is simply unbelievable against the heartache,my wife & I, and several thousand other UK citizens have endured over such a long period and even today we do not know if or when we shall receive a penny for our losses!

Indeed numerous comments from UK MP's including my own, merely reply with quite terse language such as "beyond our jurisdiction", separate Financial Services Authority etc etc. Perhaps the most galling comments have come from our Government itself via the Chancellor who has accused us on more than one occasion of being tax dodgers! How ironic since the "tax evasion" tactics of so many MP's have now been highlighted so dramatically that our morals come into question! Not only did these people not pay tax they took income which was gross and net of tax of course to which they plainly were not entitled!

It would restore my confidence in our "system" if I was able to see more immediacy of pressure brought against the Manx Government, possibly a loan to the same body and or some more evidence of pressure on the Icelandic Government to honour its parental guarantee.

I do hope our MPs survive this crisis, but it is sometimes good to reflect on the suffering of others at the same time! "

Barry Sheerman

  • Anonymous
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  • Wed, 20/05/2009 - 14:35

Here's an email I got from Barry Sheerman, MP for Huddersfield. It arrived in my box earlier today (Wednesday). He has been on our case and IS Labour:

Dear Mr *****,

Thank you for your email concerning Kaupthing Singer and Friedlander (Isle of Man). I am aware this is something that has affected many people in the UK, including some of my constituents. As such, I have taken a keen interest in helping to ensure a successful resolution of this problem. On Tuesday I tabled a written question to the Treasury to ask how the Government plans to act upon the recommendations of the Treasury Select Committee and finally resolve this matter. I will contact you when I receive a response.

Yours sincerely,

Barry Sheerman

Reply from James Elles, MEP

  • Anonymous
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  • Mon, 18/05/2009 - 16:23

I have just received the following letter from James Elles, MEP:

Dear . . .

Thank you for your e-mail regarding the collapse of Kaupthing, Singer & Friedlander (Isle of Man). My apologies for not replying sooner.

In reply, I thought you would be interested to see the essence of a reply from Commissioner McCreevy, responsible for the Internal Market and Services within the Commission, in response to the case of a constituent who found himself in similar unfortunate circumstances. Commissioner McCreevy informed me that the Commission is regretfully not in a position to take any action in this instance, as special terms were negotiated for the Isle of Man when the UK joined the EC. The Isle of Man falls within the Common Customs Area and the Common External Tariff, and other Community law provisions, such as those related to the Internal Market which would underpin any intervention by the Commission, do not apply to the Isle of Man.

However, I have forwarded your correspondence to Commissioner Rehn, Responsible for Enlargement within the Commission, asking him to respond to your suggestion that a primary condition of any consideration regarding the accession of Iceland to the EU and/or joining the single currency, should be that they meet their obligations under the Parental Guarantee that was lodged with the Isle of Man authorities and used to promote Kaupthing, Singer & Friedlander (Isle of Man) Limited as a safe place for people to put their money.

I will be back in touch as soon as I receive a reply from the Commissioner.

With best wishes,

James Elles MEP
Conservative Member - South-East Region

Reply from Nick Clegg's Office

  • Anonymous
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  • Fri, 15/05/2009 - 16:49

Also mentions Liberal Democrat MP, Alan Beith's support:-

Thank you for your letter to Nick Clegg MP regarding Kaupthing, Singer and Friedlander, Isle of Man (KFSIOM).

The Liberal Democrats agree that the British government should be pressing Iceland to repay British Isle of Man savers as well as UK depositors and we will continue press the Chancellor to do this.

One complexity is that Isle of Man savers are of different kinds and the focus of responsibility is different in each case. First there are those with personal deposits in the Isle of Man bank, some of whom did not chose to be there, (for example because of the takeover of the Derbyshire Building Society by KFSIOM last December). Second, there are those whose investment is contained in a ‘wrapper’ from a leading insurance company and the policy holder was almost certainly unaware of the significance of the choice made on his or her behalf. Whatever happens through the Government route investors should question their pension/insurance company’s or IFA’s judgement if the decision to invest took place after downgrades and public warnings around since misselling may have occurred. If misselling can be established then compensation may be payable through the Financial Ombudsman.

Liberal Democrat MP, Alan Beith, in his role as the Chairman of the Justice Select Committee, is also pressing the Lord Chancellor, who has some responsibility for relations with the Isle of Man, to take an active role in pressing both the Icelandic and the Isle of Man Governments to agree a scheme for repayment.

Thank you once again for emailing us.

Best wishes

Anna Brown
Correspondence Manager
Office of Nick Clegg MP

Statement from Alistair Darling via Nick Cleggs office

  • Anonymous
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  • Wed, 15/07/2009 - 08:22

On 2nd June 2009, I sent the following email (see below) to Nick Clegg, my constituency MP, in the lead up to the SOA vote & recent court hearings. I wanted to raise our profile once again, to get some answers to our unresolved questions as to when we are going to get our money back in FULL.

Nick Clegg targetted my questions at Alistair Darling, Chancellor of the Exchequer, & instigator of this whole fiasco.

Alistair Darling's response is also attached (see below). You will note it is woefully inadequate & simple tries to pass the burden of responsibility onto the IOM & Icelandic Governments & financial service authorities.

I believe the key betraying statement comes in paragraph 9,

"The Treasury had power under the Act to make such an order where it was desirable to do so in order to maintain the stability of the UK financial system in circumstances where there would otherwise be a serious threat to its stability."

...& of course there has been "stability" to the lives of all us KSF(IOM) depositors as a result of that action ! What a Muppet !

As stated, the reply from Alistair darling is woefully inadequacy & I feel we could leverage further pressure & embarrassment on him & this betraying UK Government, via Nick Cleggs office. [NB. It was Gordon Brown himself, who encouraged us to save for our retirement rather than living on credit & being a burden on the State in later life.]

But before I draught my indignant & dissatified reply, perhaps I could invite comments from the DAG legal team & depositors (particularly the Class 2, £50K+ Group, who's money is not completely covered by the IOM Treasury's Depositor's Compensation Scheme (DCS)), to ensure we strike back with a clear, concise message to ensure there is public outcry to our plight & finally we get 100% of our money back (with interest, if necessary, from HM Treasury).

>> MY LETTER TO Rt.Hon. Nick Clegg MP

Dated: 2nd June 2009

Dear Mr. Clegg,

RE: The demise of Kaupthing Singer & Friedlander (Isle of Man) (“KSFIOM”)

I am writing to you in connection with the demise of KSFIOM. I would like your support in recovering my money in full, plus interest, so that there might be some restoration of confidence in British democracy, justice & the banking system.



I stand to lose my life savings of £XXX,000. I want that money back in FULL, with INTEREST, after all I have done nothing wrong. This is my hard-earnt money. I have worked, saved & lived within my means, encouraged by this & previous UK Governments, to save for my retirement rather than living on credit. Let me re-iterate, I want it ALL back, along with my legally entitled interest backdated to the time of the bank’s collapse on 8th Oct. 2008. This is daylight robbery, to which the UK & IOM Governments, plus KSFIOM should be held accountable.

Since I last wrote to you on 6th Nov. 2008, I have continued to experience financial hardship. I continue to be £XXX,000 worse off & there has been no progress by the UK & IOM Governments & KSFIOM, to resolve any of the issues that would ensure the full recovery & return of my money.

Please advise what steps your office has undertaken to recover my money ?

It is clear from the events of the last eight months that there has been regulatory failure on both the part of the FSA in the UK & the FSC in the Isle of Man. Equally clearly, there have been significant political maneuverings to avoid answering the many questions that have been raised & remain unanswered.

It is imperative that there is an independent inquiry in the UK & the IoM into the events surrounding the insolvency of KSFIOM to resolve these matters. I accordingly ask you personally to request the UK Treasury, the UK Justice Department & the IoM Government for explanations regarding the many pertinent questions regarding this financial crisis that is still bringing both great distress and financial destitution to over 10,000 depositors including myself.

1. An unusual set of circumstances, triggered by the UK Government in October 2008, resulted in the collapse of an otherwise healthy bank. Why did the FSA apparently not adhere to its agreement with the FSC, & choose not to consult & advise the FSC about its intentions regarding KSFIOM as it had previously when Bradford & Bingley was in difficulty?

  1. Why did the FSA & the FSC, who expressed concern about KSFIOM’s Icelandic parent company, Kaupthing Hf, permit or instigate the transfer of over 50% of KSFIOM's assets with Kaupthing Singer & Friedlander Limited (“KSFUK”), a transfer which:
    · was to a single bank in the same group as KSFIOM;
    · benefited from no form of protection for KSFIOM whatsoever; &
    · left the assets still exposed to the insolvency of Kaupthing Hf?

  2. An Arrow report is reported to have been conducted by the FSA that gave KSFUK a clean bill of health just one month prior to the UK Government's move to render this same bank effectively insolvent. Why will the FSA not publish its findings?

  3. What basis does the UK Government have for implementing S.I 2674, which effectively gave them control over 50% of KSFIOM's recently-transferred assets - a fact that Mr. Darling withheld from the Treasury Select Committee when he was questioned by the TSC in November 2008 ?

  4. The court papers relating to KSFUK were sealed at the time the order dealing with the transfer of assets from KSFUK to ING was made. This was a highly unusual step, & continues to be the case. What is in those sealed papers relating to KSFUK?

  5. Why did the UK Treasury set up two Bank of England trust accounts nearly two weeks prior to the events of 8 October 2008, in which money being transferred out of KSFIOM was secretly held?

  6. How was the UK Treasury able to transfer the retail business of KSFUK – a significant & complex transaction with a value of hundreds of millions of pounds - within a matter of a few hours of the court order being made?

  7. Why did the IoM FSC change their handbook & regulations in the months prior to the collapse of KSFIOM so as to give itself immunity from liability?

  8. Why does KSFIOM remain the only Kaupthing subsidiary in the whole world which is not recompensing its depositors in full?

  9. Why did the department in the UK Government that is responsible for dealing with Iceland on the IoM’s behalf, the Ministry of Justice, delegate its responsibility to the UK Treasury, which is itself implicated in the events leading up to the insolvency of KSFUK – events which Kaupthing hf has successfully been granted leave to have a judicial review of at the High Court in England – & which is therefore inherently conflicted on the matter? Why did the IoM Government apparently accept this delegation of authority?

  10. Why are will the UK Government not compel the IoM Government to work with it to find an appropriate solution in line with (i) newly adopted common best practice relating to retail depositors & (ii) the recommendations of the Treasury Select Committee in its recently-published report into the Icelandic banking crisis ?

I would accordingly like you to propose that a full inquiry into the demise of KSFUK & KSFIOM is carried out, to be conducted under an independent committee.

Judging by the actions of the IoM Government over the last eight months, it will do everything it can to disguise the truth & ensure that the island, its regulatory body & its politicians are protected regardless of the consequences for people who placed their money in good faith with a regulated bank on the IoM.

Justice, transparency, the truth & the full return of our money, are what KSFIOM’s depositors are looking for at this stage. Eight months of inexplicable delays & obfuscation by the authorities concerned have served only to heighten depositors’ despair at the tactics being deployed by authorities that should protect their interests, & to increase the anguish of facing an uncertain future. Depositors have done nothing more than deposit their family & retirement savings in a bank located in a AAA-rated economy that was regulated by a body that is repeatedly commended for its performance, yet they have been unable to access those savings for eight months while in every other major jurisdiction in the world – including Iceland itself - retail depositors have been protected against the consequences of the financial crisis on the global economy.

After the distress of the last eight months we believe that we deserve the attention of the UK politicians who represent us, & of the UK Justice Department that is meant to be responsible for the UK’s relations with the IoM & between the IoM and Iceland.

We are determined to be reunited with 100% of our money & will not rest until the truth behind what led to this debacle has been exposed for all to see – as recently demonstrated by depositors’ rejection of the IoM Treasury’s proposal for a scheme of arrangement that would have prevented any further investigation of the matters outlined above.

Please take my case to the appropriate authorities & ensure that truth & honesty prevail.

>> REPLY FROM Rt. Hon. Nick Clegg MP

Dated: 7 July 2009

Please find enclosed a copy of a letter I have now received from Alistar Darling MP, Chancellor of the Exchequer at HM Treasury in response to an enquiry made on your behalf.

I hope that this is of some assistance to you. However, if you would like to contact me again on this or any other matter then please do not hesitate to do so.

>> RESPONSE FROM Alistair Darling, Chancellor of the Exchequer, HM TREASURY

Dated: 1 July 2009

Dear Nick

Thank you for your letter of 9 June enclosing correspondence from your constituent about Kaupthing Singer Friedlander (IOM).

As you may know, KSF(IOM) is not a subsidiary of KSF in the UK, but of an Icelandic company in the Kaupthing Group. It was the responsibility of the IOM’s regulator to assess how the failure of the parent company in Iceland or the failure of any other company in the group would impact on the IOM subsidiary & take the appropriate action. Ultimately this was a failure that started in Iceland & responsibility for banks in Iceland rests with the Icelandic authorities.

The action which should be taken in relation to KSP(IOM) in the future is also a matter for the IOM authorities. However, we are aware that following the meetings of creditors on 19th May 2009, the Scheme of Arrangement proposed by the Company & the Treasury of the IOM was not approved by creditors. At a hearing in the IOM High Court on 27th May 2009, a winding up order was passed in respect to KSF(IOM & it has been placed into liquidation.

Arrangements for depositors in banks in the IOM are a matter for the Government of the IOM. As KSF(IOM) has been put into liquidation the Depositors Compensation Scheme (DCS) has been triggered. Deposits with KSF(IOM) may be eligible for the DCS. The Joint Provisional Liquidators have noted that they are working with the manager of the DCS to ensure that payments are made to creditors as soon as practically possible. Furthermore the IOM Government has stated that it will work to support the liquidation & DCS process with a view to expediting the repayment of depositors.

We are also aware that since the beginning of the year, the IOM Government introduced & funded Early Payment Schemes to provide advance payment of up to £10,000 for depositors. The IOM Authorities have noted that more than £60 million has already been paid out under these schemes, with a further £10 million about to be paid. Further information is available on the IOM’s website: & the KSF(IOM) website:

Further information about the DCS & eligibility for the scheme is available on the IOM Government’s website at:

On 3 October 2008 the Financial Services Authority issues KSF(IOM) with a Supervisory Notes that required the bank to establish a trust account with the Bank of England (or with an alternative Financial Services Authority-approved provider). The trust account was to be credited with amounts equal to new funds deposited by customers with the effect that these funds would be held under trust & therefore ring-fenced in the event that KSF entered into insolvency proceedings. Funds from KSF(IOM) were not transferred to the trust account as the Financial Services Authority’s powers relate to the protection of consumers of regulated services in the UK. Therefore debts owed to the group companies, such as KSF(IOM) & to other financial institutions do not fall within the scope of the Financial Services Authority’s regulatory powers.

On 8 October the Financial Services Authority determined that KSF(UK) no longer met its threshold conditions for the purposes of its authorisation to accept deposits & was unlikely to be able to continue to meet its obligations to depositors. The Financial Services Authority, in the exercise of its regulatory functions, concluded that KSF(UK) was in default for the purpose of the Financial Services Compensation Scheme.

In order to preserve financial stability & provide protection & continuity for depositors, the Treasury made a statutory transfer order under the Banking (Special Provisions) Act 2008 to transfer KSF’s Edge deposit business to ING Direct, a wholly-owned subsidiary of ING Group. The Treasury had power under the Act to make such an order where it was desirable to do so in order to maintain the stability of the UK financial system in circumstances where there would otherwise be a serious threat to its stability. That was so in the case of KSF(UK). The transfer of the retail deposit accounts was backed by HM Treasury & the Financial Services Compensation Scheme. This transfer order (SI 2674) had no effect on KSF(IOM)’s assets & was published as soon as it was made.

Following due legal process, KSF(UK) was put into administration. It is correct that, when ordering that KSF(UK) be put into administration, the court also ordered that its file relating to the application fro administration should not be open to inspection without leave of court (except for the court contained information which was commercially sensitive & confidential under Section 348 the Financial Services & Markets Act 2000.

Ernst & Young LLP has been appointed as the Administrator for KSF(UK). As part of the administration process, as is usual, a moratorium is in place on the enforcement by creditors of claims against KSF(UK).

KSF(IOM) had deposits in the region of £532m with its sister company KSF(UK) at the time of KSF(UK) entering into administration. Under UK insolvency law, KSF(IOM) ranks like any other creditor in the administration – money that a customer has placed with a bank on deposit (including with a sister company) is a liability of the bank in which it has been placed. The customer only has a debt claim against the bank. If the bank chooses to place the money it has received on deposit from a customer with a second bank the first bank is placing its own money with the second bank & the customers of the first bank do not have any direct legal claim to the deposit with the second bank. KSF(IOM) will have been fully aware of this. It could have chosen to put its money elsewhere & to have diversified the deposit it made rather than making a single large deposit, which concentrated the credit risk to which it was exposed. As it is, this sum is now subject to UK insolvency procedure & forms part of the administration estate of KSF(UK). This matter was discussed at the Treasury Select Committee hearing on 3 November 2008.

The first UK creditors’ meeting for KSF(UK) was held on 1 December 2008. At this meeting, representation for the Creditors’ Committee was determined by the creditors. Although the KSF(IOM) Joint Provisional Liquidator is not a member of this Committee, the administrators of KSF(UK) are in ongoing, constructive & cooperative discussions with the Joint Provisional Liquidator for KSF(IOM). They also publish information on the administration on the KSF website:

As set out above, the steps taken by the Financial Services Authority & us, in relation to KSF(UK), had no bearing on the status of the parent company, Kaupthing Bank hf, which is incorporated under Icelandic law & subject to supervision by the Icelandic Financial Supervisory Authority.

As you may be aware, I announced on 24 November 2008 that I would be commissioning an independent review of long-term opportunities & challenges facing Britain’s Crown Dependencies & Overseas Territories. The terms of reference for the review, which is being led by Michael Foot, were published on 2 December 2008 & are available on the Treasury’s website:

Yours sincerely

Alistair Darling

Response to Nick Clegg's office re. Alistair Darling's statement

  • Anonymous
  • Offline
  • Mon, 27/07/2009 - 06:09

On 26th July 2009, I sent the following email (see below) to Nick Clegg's office, in response to the reply I received from Alistair Darling, Chancellor of the Exchequer.


Thank you for your letter dated 7th July 2009 containing a response from Alistair Darling, to questions I raised regarding the collapse of Kaupthing Singer Friedlander (IOM).

You hoped Alistair Darling’s letter “was of some assistance to” me, however I can categorically state it was woefully inadequate & has done nothing to help me FULLY recover my life savings. I continue to suffer financial hardship, due to Alistair Darling’s actions in confiscating the deposits of KSF(IOM) Edge Accounts (my money) on 8th Oct. 2008.

Since that date he has shown contempt & wilful neglect of duty to rectify the situation, preferring to side-step his constitutional responsibility by passing the burden of blame & restitutional ownership onto the governments of the IOM & Iceland, when he himself was the initiator of this whole sorry fiasco.

It was Alistair Darling, Gordon Brown & this UK Government that encouraged us all to save for our retirement (“a nation of savers”) rather than living on credit & being a burden on the State in later life. Now, through Alistair Darling’s very action of seizing & confiscating KSF Edge deposits, he has betrayed honourable & upstanding UK citizens (& other depositors) who have worked hard all their lives, to live within their means & save for their retirement.

There was nothing contained within Mr. Darling’s letter that I did not know already as an active member of the KSF(IOM) Depositors Action Group (DAG). There was nothing of substance relating to what he personally was going to do to recover my money & that of others, & the associated timescales.

He stated he seized the KSF Edge deposits “to preserve financial stability and provide protection and continuity for depositors” Well he failed magnificently having caused untold misery, hardship & debt to all depositors involved.

Furthermore, I find it abhorrent that he should seize my money & that of others in order “to maintain stability of the UK financial system”. He is using my money for political gain, when there should have been sufficient banking regulations & other safeguards in place to protect innocence depositors from unscrupulous & unsecured trading.

Mr. Darling goes on to state that a claim could be made via the IOM Treasury Depositors Compensation Scheme (DCS), however he fails to mention this only covers the first £50,000. What about my remaining £XXXXXX ? Having made a claim I am then onerous to the IOM Government for any later payout & that of outstanding interest; the very government (along with the UK) who failed to properly regulate the bank’s solvency & general trading conditions. This is the very government who proposed an amateurish & flawed “Scheme of Arrangement” (SoA) to reimburse depositors, which consequently was rejected outright, & who now expect those same depositors to pay for this badly conceived plan !

Liquidation estimates suggest I may only get 82% of my initial deposit back & that payments, in the form of dividends, will be payable until 2015 ! That is not good enough.

We, the depositors of KSF(IOM), want ALL our money back in FULL, with INTEREST, NOW. We, along with our life savings are being used as political pawns, at the whims of incompetent & negligent financial institutions, regulatory bodies & the governments of the IOM, UK & Iceland.

It is scandalous how good, honest UK citizens (& other investors) are being totally disregarded, while the likes of the Chancellor of the Exchequer & other corrupt MPs & civil servants feather their own nests with public money from fraudulent expense claims. It’s disgusting; one rule for Mr. Darling & Co. & another for the rest of us !

This has got to stop. This issue needs resolving NOW by the UK Government. They have already bank-rolled Lloyds-TSB, Royal Bank of Scotland & Northern Rock to the tune of £1.4T, so why neglect KSF(IOM) ? Please do not insult my intelligence by stating the IOM is a crown dependency. This is a technicality that the UK Government easily overlooked when seizing my assets & which it could now easily resolve.

The UK used to be a decent & honourable country in which to live. Sound financial institutions offering secure longer-term investment security. It used to be the bedrock of our society. This is a fundamental right; it is why we work hard, save, live within our means & vote or don’t vote for current political leaders. Why should I ever trust the UK, IOM or Icelandic Governments or any of their corrupt banking institutions & regulatory bodies ever again ?

Please leverage all political pressure & use my case to score whatever political points, in open forum, against Mr. Alistair Darling & this betraying UK Government, in order that they might have a conscience to resolve this fiasco of their making, so that I & hundreds of others might see an immediate & full recovery of ALL our funds (with interest).

I will be forwarding a copy of this communication to the media because I can no longer afford to await the procrastination of the UK, IOM & Icelandic Governments.
The world needs to know how poorly we are being treated.

Furthermore, I would strongly urge you to reject all attempts by the Icelandic Government to be accepted as a member state of the EU until all it’s financial debts are settled in full.

Give me my money

  • Anonymous
  • Offline
  • Mon, 27/07/2009 - 06:33

An excellent email to Nick Clegg. However, we all know that the present UK government is devoid of any feeling to the IoM depositors in KSFIoM, having pathetically rolled out the well worn story that it is not their problem , but the IOM's.

I'm in a similar position, being a plus 50K depositor and I had hoped to retire abroad very shortly. Nothing would possess my wife and myself to reside in the UK. The country has denigrated to Third World status in our eyes.

I cannot hope to recoup my savings and certainly can't wait until possibly 2015 to get a proportion of my savings back.

I have asked this before but can someone please tell me what DAG/DST are doing in all this?

Nick Clegg is also woefully inadequate

  • Anonymous
  • Offline
  • Wed, 15/07/2009 - 09:59


Well done for trying.

Before leaving UK (many years ago), I lived for 20 years in Sheffield Hallam and have written several times to Nick Clegg as MP for my former constituency. Others have written to him as leader of the Lib Dems. Despite the fact that several of his party appear to be sympathetic to our cause (the lastest being Mark Williams who has raised the question of a public inquiry in Parliament - and been snubbed by Treasury for his pains) - Nick Clegg has been a huge disappointment and appears to be totally unwilling to express any opinion or take any action himself. All his replies to date (to myself - once only - and to others) have simply passed on the official HMG mantra in practically identical standard letters (some of which have been posted in this thread). Admittedly his reply to you is somewhat different in that it shows that he did at least raise your questions with Mr Darling. But all he then does is present you with Darling's stock response which of course answers none of your questions.

Of course Darling's response is - as you say - woefully inadequate (to put it mildly!); all his replies are the same - the standard story the Treasury trots out all the time like an old record. It does nothing to address your questions and tells you nothing you did not already know. But you wrote to Nick Clegg, as your MP. And all he can offer you is the following 3-sentence reply:

"Please find enclosed a copy of a letter I have now received from Alistar Darling MP, Chancellor of the Exchequer at HM Treasury in response to an enquiry made on your behalf.

I hope that this is of some assistance to you. However, if you would like to contact me again on this or any other matter then please do not hesitate to do so."

Assistance to you? My foot! Even more worrying is that he no longer even offers his sympathy for your plight (which he did - via his correspondence manager - in his earlier letters). I can only assume he read neither your questions nor the (non-)reply of Mr Darling. I would reply in the strongest possible terms to tell him just that and ask what he will do to help you. You have every reason to be "indignant & dissatisfied" with Nick Clegg - so address your anger at him. Ask him directly whether or not he will do what you asked (and which he probably never even read) : to press for an independent inquiry into this affair. IMO this is now the only way forward politically; unless their role in this debacle is exposed and criticised in a public inquiry, HMG will never do anything for us. DAG/DST is pushing hard for this and we need to do all we can to help by lobbying our MPs to support our demands.

With respect to Nick Clegg, you are in a stronger position than I or others are to do this because you are one of his constituents and he is supposed to listen to you. Can you try to get an appointment with him at one of his surgeries? He can harldy refuse to see you and it will be harder for him to brush you off face-to-face.

Good luck. If you can get anywhere with Mr sit-on-the-fence Clegg I'll take my hat off to you!

Nick Clegg - ummmm!

  • Anonymous
  • Offline
  • Fri, 15/05/2009 - 17:51

Really depressing! I had the same letter from Anna Brown on 5 January, except for the first paragraph, which in my case was as follows:

"Thank you for your letter to Nick Clegg MP regarding Kaupthing, Singer and Friedlander, Isle of Man (KFSIOM). I am very sorry to read of your circumstances. This must be an extremely stressful and worrying time. Nick has asked me to reply to you on his behalf and to extend his sympathies for your situation. The bank collapsed in the wake of the action taken by the UK Government to secure Kaupthing’s UK depositors by transferring retail deposits under the “Edge” brand to ING Direct and by placing the bank into administration, in effect freezing its remaining UK based assets, including those of KFSIOM."

The rest was exactly the same. So all he has done since 4 months ago is to stop offering his sympathies and to remove any suggestion of a role of the UK Government.

Not exactly an encouraging trend...

Nick Clegg - ummmm!

  • Anonymous
  • Offline
  • Fri, 15/05/2009 - 17:52

Sorry - duplicated


  • Anonymous
  • Offline
  • Fri, 15/05/2009 - 16:38

Encouraging reply from a (Conservative) MP who has been consistently supportive -

From: BELLINGHAM, Henry (BELLINGHAMH(?)parliament [dot] uk)
Sent: Friday, May 15, 2009 11:12:55 AM
To: chb

Thank you very much indeed for your e-mail in connection with Kaupthing Singer & Freidlander IoM.

I am very grateful to you for taking the trouble to contact me and I can obviously understand your sense of anger, dismay and outright frustration.

However I can assure you that myself and various other MPs are doing all we possibly can to keep up the pressure. We have been in constant touch with the Isle of Man Government and indeed I organized a meeting in the House which was attended by the Isle of Man Treasury Minister, Allan Bell and the Head of their FSC, John Spellman.

We have also had correspondence with the relevant Treasury Minister, Lord Myners, and I certainly take on board your point about the Administrators of KSF UK allowing Dave Whelan to remove funds. Indeed, we have been in touch with Lord Myners on this very point, but unfortunately he is very slow at replying to letters.

If you let me have your address, I will of course send you copies of the letters that we have received and I will carry on doing all I possibly can both for you, and the two other constituents who are affected.

Every best wish,

Henry Bellingham

Ian Pearson reply to Alan Beith

  • Anonymous
  • Offline
  • Thu, 14/05/2009 - 09:13

Seems Alan Beith continues to try.
Yet another non-reply by Ian Pearson. How do honest MPs survive ?

Stick a comment in!

  • Anonymous
  • Offline
  • Fri, 15/05/2009 - 01:31

May as well it mayhelp MPs distract themselves form their usual occupations - ripping off the public to the last bath plug


Well done Alan

  • Anonymous
  • Offline
  • Thu, 14/05/2009 - 14:59

It gives me some hope that men such as Alan Beith are still asking for the right thing to be done. OK, so no result yet but HMG cannot ignore questions for ever.


  • Anonymous
  • Offline
  • Thu, 14/05/2009 - 16:57

I added a comment I dont know if members of the public are suposed to comment but if the site accepts it why not?

SAY NO to Pearson's (non-) answer to Alan Beith

  • Anonymous
  • Offline
  • Thu, 14/05/2009 - 17:03

Indeed, it appears you can comment. Well done bellyup!

But also, something EVERYONE can do is simply tick the box provided on the site (link above) to say whether you think he (Pearson) answered the question (from Beith). So far there are 9 vote for no and none for yes...

HMG cannot ignore questions for ever ...

  • Anonymous
  • Offline
  • Thu, 14/05/2009 - 16:02

... "HMG cannot ignore questions for ever"?
I hope you are right, but they seem to be doing a pretty good job of it so far!

Have just written (again) to Alan Beith.

I too will write..

  • Anonymous
  • Offline
  • Thu, 14/05/2009 - 16:55

lets all write to the liberal mp Alan Beith

David Cannan

  • Anonymous
  • Offline
  • Fri, 08/05/2009 - 23:29

Here is the response I received from David Cannan today:

In response to your e-mail I have placed the following Question on the
Tynwald Order Paper for Tuesday 19 May 2009:-

Question For Oral Answer.

The Hon Member for Michael (Mr Cannan) to ask the Minister for the

Whether all Kaupthing Singer & Friedlander (IOM) Bank depositors
resident outside the United Kingdom will have received their proxy voting
forms in time to be eligible to vote on the proposed Scheme of Arrangements?


David Cannan

Andrew George MP

  • Anonymous
  • Offline
  • Fri, 08/05/2009 - 21:45

Awaiting Lord Myners response to Andrew George MP. He wrote to Myners before and we received a standard reply that had been sent to others as well.

1 May 2009

Dear xxx
Thank you for your letter received in my office on 29th April 2009, and I appreciate you taking the time to provide me with an update on your current position regarding Kaupthing Singer and Friedlander.

I have now conveyed your concerns to Lord Myners, Financial Services Secretary to the Treasury, and as soon as I have further information I will contact you again.

I hope this is helpful.

With every good wish.

Yours Sincerely,

Andrew George MP
[signed personally]

Reply from Juan Watterson - Member of the House of Keys

  • Anonymous
  • Offline
  • Fri, 08/05/2009 - 07:20

Dear xx

I have today lodged a question for the Treasury Minister to be answered in Tynwald on 19th May which reads, “Further to HM Government’s guarantee to KSF depositors in that jurisdiction that 100% of their deposits will be returned, and given that UK actions directly resulted in the provisional liquidation of the Isle of Man subsidiary of KSF, what representations have been made to the UK authorities to extend their 100% guarantee to depositors KSF Isle of Man?”

The question paper will be published a week today for this sitting, and will be available on the Tynwald website

Yours sincerely

Juan Watterson BA(Hons) ACA MHK

Member of the House of Keys for Rushen

Legislative Buildings




From David Cannan Tynwald

  • Anonymous
  • Offline
  • Fri, 08/05/2009 - 16:24


DATE 08 MAY 2009


Dear xxx

In response to your e-mail regarding the Report of the Treasury Select
Committee and the comments of Mark Todd MP, I have placed the following two
Questions on the Tynwald Order Paper for Tuesday 19 May 2009:-

  1. For Oral Answer

The Hon Member for Michael (Mr Cannan) to ask the Minister for the

(1) Whether he is aware that the House of Commons Treasury Select Committee
has completed its Report into the collapse of the Kaupthing Singer &
Friedlander UK Bank and if so, whether he has studied the document;

(2) if he will make a statement on comments in the Report on Kaupthing
Singer & Friedlander (IOM) Limited, the Isle of Man Financial Supervision
Commission and the Isle of Man Government?

  1. For Oral Answer

The Hon Member for Michael (Mr Cannan) to ask the Minister for the Treasury-

Whether he is aware that a Member of the House of Commons Treasury Select
Committee, Mark Todd MP, has advised Depositors of Kaupthing, Singer &
Friedlander (IOM) Bank as follows: "There is a large difficulty here. The
Isle of Man is clearly sovereign in the matter (as the report indicates).
It must be for their Government (Isle of Man) to seek assistance. If they
(Isle of Man) could be persuaded to make an approach to the United Kingdom,
I am sure that I, and other MPs could assist in pressing for assistance to
be given. However, it seems (so far) that they do not wish to ask"; what
his response is to this statement.


David Cannan

Via Tynwald Members Office

Reply David Cannan Tynwald

  • Anonymous
  • Offline
  • Mon, 11/05/2009 - 17:14

Belly up

I was just about to post the same reply from David Cannan received in my box earlier today -- seems we both targeted the same Tynwald member - Good stuff ---

He seems to be asking a number of questions as shown on this thread - more pressure to the wheel

Everyone who thinks an e-mail is a waste of time - I say :- just write one - it may just be the straw that breaks the camels back!!


  • Anonymous
  • Offline
  • Fri, 08/05/2009 - 20:47


agree icecrusher

  • Anonymous
  • Offline
  • Sat, 09/05/2009 - 09:16

PERSISTENCE...keep at it...its the only way

From Ministry of Justice Jack Straw and Lord Back

  • Anonymous
  • Offline
  • Fri, 01/05/2009 - 16:11



Thank you for your email of 13 April 2009 and letter of 14 April, addressed to Lord William Bach, Parliamentary Under-Secretary of State, and Jack Straw, the Secretary of State respectively in respect of KSF IoM, which have been passed to me for reply.

The Ministry of Justice is the UK Government Department with responsibility for managing the UK’s relationship with its Crown Dependencies (Jersey, Guernsey and the Isle of Man). In line with the UK’s constitutional responsibilities, HM Treasury is representing the interests of the Isle of Man in negotiations with the Icelandic authorities.

Let me assure you that the ministerial teams in the Ministry of Justice sympathise with all those depositors who have funds caught up in KSF IoM.

The Isle of Man (like its sister Crown Dependencies) is not part of the UK. It is a self-governing dependency of the Crown with its own directly elected legislative assembly, administrative, fiscal and legal systems and its own courts of law. The Isle of Man is not represented in the UK Parliament and UK legislation does not extend to it without its consent. The Isle of Man is not part of the European Union or the European Economic Area and banks established in the Isle of Man do not, therefore, benefit from ‘passporting’ rights under European banking directives. As stated, in fiscal and regulatory areas, the Isle of Man, at its own resolve, is independent of the UK.

KSF IoM is not a subsidiary of Kaupthing Singer and Friedlander in the UK but of an Icelandic company in the Kaupthing group. It was the responsibility of the Isle of Man’s regulator, the Financial Supervision Commission, to assess how the failure of the parent company in Iceland, or the failure of any other company in the group would impact on the Isle of Man subsidiary and take the appropriate action. Ultimately, this is a failure that started in Iceland and responsibility for banks in Iceland rests with the Icelandic authorities.

As KSF IoM does not fall within the scope of the UK regulatory regime, depositors in KSF IoM are not eligible for compensation under the UK Financial Services Compensation Scheme (FSCS). The UK government cannot provide cover for deposits held by British citizens in jurisdictions outside the direct control of the United Kingdom. The Treasury Select Committee in its report of 4 April 2009 agreed with this principle.

On 3 February 2009, at the Treasury Select Committee hearing on the protection of UK citizens investing funds in non-UK jurisdictions the Isle of Man Authorities were asked whether the Isle of Man has the resources to pay out up to £50,000 per depositor required under its compensation scheme. The Chief Minister of the Isle of Man responded that the Isle of Man is satisfied that they have the resources.

On 9 October 2008, the Isle of Man Court made a Provisional Liquidation Order in relation to KSF IoM. On 19 February 2009, the Isle of Man Court ordered an adjournment of the hearing of the winding up petition until 9 April 2009 to allow the Isle of Man Treasury to prepare a Scheme of Arrangement. On 19 May 2009, KSF IoM depositors will decide between the Scheme of Arrangement and liquidation and activation of the Depositors’ Compensation Scheme (DCS). Further information is available on the Isle of Man’s website: .

Arrangements for depositors in banks in the Isle of Man are a matter for the Government of the Isle of Man. Deposits with KSF IoM will be subject to the Isle of Man Depositors’ Compensation Scheme (DCS). Further information about the DCS, and eligibility for the scheme, is available on the Isle of Man Government’s website:

On 8 October 2008, the Financial Services Authority (FSA) determined that KSF UK no longer met its threshold conditions, and was unlikely to be able to continue to meet its obligations to depositors. The FSA, in the exercise of its regulatory functions, concluded that KSF UK was in default for the purposes of the Financial Services Compensation Scheme (FSCS). Following due legal process, KSF UK was put into administration. Ernst & Young LLP has been appointed as the Administrator for KSF UK. As part of the administration process, as is usual, a moratorium is in place on the enforcement by creditors of claims against KSF UK.

The business models of many banking operations in the Crown Dependencies involve the practice of upstreaming deposits for Treasury management by the parent company. In practice, this means that banks incorporated in the Crown Dependencies deposit an amount equal to a significant portion of their deposits they receive from customers with their parent company. KSF IoM had deposits in the region of £532 million with its sister company KSF UK when KSF UK entered into administration. Under UK insolvency law, KSF IoM ranks like any other creditor – money that a customer has placed with a bank on deposit (including with a sister company) is a liability of the bank in which it has been placed. The customer only has a debt claim against the bank. If the bank chooses to place the money it has received on deposit from a customer with a second bank, the first bank is placing its own money with the second bank and the customers of the first bank do not have any direct legal claim to the deposit with the second bank. KSF IoM will have been fully aware of this. It could have chosen to put its money elsewhere and to have diversified the deposits it made rather than making a single large deposit, which concentrated the credit risk to which it was exposed. This sum is now subject to UK insolvency procedure and forms part of the administration estate.

The first KSF UK creditors’ meeting was held on 1 December 2008 and at this meeting representation for the creditor committee was determined by the creditors. The Provisional Liquidator for KSF IoM, Michael Simpson of PriceWaterHouse Coopers LLP, drafted a report on the creditors meeting, including the Administrator’s Statement of Proposals. This report can be found at:

The UK Government will continue to work with the Icelandic authorities and through the International Monetary Fund to ensure fair treatment for all depositors and other creditors.

I hope this information helps to explain the current position in relation to funds deposited in KSF IoM.

Yours sincerely,

Fiona Salem