SoA Q&A's

  • Ally
  • 13/10/08 31/05/09
  • unspecified
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Posted: Sat, 07/03/2009 - 17:23

Following on from a couple of questions I put to IoMG a week or so ago a list of further questions was compiled and sent to IoMG. The list of questions and their answers are below.

Let me state that in no way does this signal my support for or against the SoA. Indeed both options currently before us are extremely unpalatable. However come the 9th April, barring any miracles in the meantime, that is the choice that we are going to have to vote on. So any clarification on either is welcome.

1) We understand that the top up payments made to guarantee 100% recovery to depositors with £50k and under will be paid for by the IOMG. This payment is therefore an outright payment and not a repayable loan from the IOMG. Please confirm if this assumption is correct?

This is correct. It is not a repayable loan, but rather an outright compensation payment that, once paid allows IOMG to “step into the shoes” of the depositor and receive future dividends until it recovers the money advanced (referred to as the ‘right of subrogation’). Therefore the same cover under the DCS is also proposed for the SoA.

2) We originally understood that under the proposed SoA all other depositors would get £50k or 60% (if 60% is the final asset recovery), whichever is the higher. This means that if the asset recovery rate is 60% a depositor with £60k would get 60% of £60k=£36k topped up to £50k by the IOMG. Is this the case? If so, is this top up also an outright payment by the IOMG?

The minimum a depositor would get is the same rights of pari passu distribution that they have in a winding up. For those covered by the DCS, they would also get a top up payment to their minimum level (as part of the three tranches) provided for under that Scheme. This payment would be an outright compensation payment, rather than a loan, but would be accompanied by a right of subrogation. The IOM Government would not seek to reclaim any monies by way of subrogation until the depositors have received at least 60p.

3) We assume that the sole purpose of the repayable loan from the IOMG would therefore be to accelerate further payments to depositors after the top up payments have been made. Please can you confirm?

The IOMG payments have two impacts. First, to accelerate lump sum payments to ensure the cover which would be available under the DCS, is paid off. Secondly, by deferring the IOMG’s recovery rights by way of subrogation, until everybody else has been paid 60p, it has the effect of increasing the dividends being paid to all creditors up to the 60p level.

4) We believe that in the original SoA "proposal" the IOMG loan would be paid once the recovered assets were to exceed the 60% mark. In addition it was, we believe, proposed that the IOMG would be treated as a preferential creditor in terms of repayment of this loan. Please can you confirm or clarify this?

The Government is providing top up funding to pay creditors their minimum entitlements early and in lump sum payments. This gives the Government a right of subrogation referred to above. The Government wish to postpone this right to recoveries by way of subrogation until 60p has been paid to everyone else. At this point, as and when further realisations allow, the Government will receive a catch up dividend up to 60p on all its claims. At no point would it be preferred or move ahead of ordinary creditors. Therefore rather than a preferential creditor, the Government is temporarily deferring its rights of recovery by way of subrogation to provide a benefit to all creditors.

5) For clarity, if asset recoveries are greater then 60% are these extra funds passed on in full to depositors, so for example if total asset recoveries were 70% then the expected return of larger depositors would be 70%?

Yes, all KSFIoM realisation will be distributed equally to all creditors up to 60p, 70p and, hopefully, beyond as higher sums are realised.

Some depositors with lower balances, who have benefited from the DCS like lump sum payments part funded by the IOMG top up funding, will have percentage recoveries higher than the declared dividends. These creditors will automatically start receiving further dividends (unless they have already been paid in full) once the declared dividends result in higher payment than what has already been paid to them.

A creditor that could not claim under DCS would continue receiving pari passu dividend payments throughout.

6) Some contributors to the DAG site appear to believe that the under the SoA the IOMG guarantees payments to all depositors of at least 60% of their deposits. Please can you confirm or clarify this postion?

This is not correct. We have estimated that asset recoveries could be at least 65p however this is subject to the recovery from London which is completely unknown at this stage. Furthermore, the loan book is UK centric at a time when the state of the UK recession / depression means that the outcome is uncertain despite its quality.

The top up funding is intended to provide a safety margin up to 60% return for everyone. This transfers some of the risk of poor recoveries to the Government. Therefore, not only those with DCS protection are covered and but the larger value creditors also benefit from priority dividends until 60p, worth up to 10% of accelerated dividends.

7) Is there a possibility that the IoMG may not get back funds it uses to accelerate the assured payments?

Yes. If the asset realisation does not reach 60p in the £, we get nothing back.

8) Do we have an ETA for the web-enabled calculation tool to be ready for use? (We appreciate an exact day may not be possible, but is it a few days, a week or a number of weeks?)

Alix Partners workings are being reviewed by the Liquidators Provisional and ideally we would like to put forward a tool jointly. This should be available later this month.

9) If the IoMG loan used for accelerated payments is only to be repaid once depositors reach 60% can an example of how this works be clearly shown on a website as this particular point seems to cause much confusion.

The mechanics are as per the notes above. Once all individual creditors get to a minimum 60p, there will be a catch-up or “equalisation” payment from the company’s asset realisation to IOMG. This will bring the IOMG recoveries by way of subrogation, to 60p on all its claims and partially reduce the top up advance.

The individual recovery profile will be best demonstrated by the web-enabled tool. However the overall impact of top up funding, the deferred recovery for IOMG, equalisation and dividends thereafter can be illustrated as follows:

Graph supplied with this answer is available on the attachement saved with this posting

10) What is the position of bondholders under the SoA? Some depositors believe that bondholders will stand as individuals in the SoA and so be guaranteed £50k each. Please can you confirm or deny this?

This is not the case. The protection under the SoA is the same as it would be under the DCS.

11) If the reply to item 10 is affirmative is the IOMG providing additional non repayable funds (i.e. not in the form of a loan) to finance the additional outlays required. Is it possible to confirm the additional cost of this measure?

Not applicable.

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Crystal Ball

  • Tricky Dicky
  • 24/10/08 30/05/09
  • a depositor
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  • Thu, 12/03/2009 - 18:53

I was looking at my crystal ball today and, in the last round of affadavits the calculations by IOMG/Alix (anagram for Spellman) were based on their assumption of a 60% return (also as above). Well my crystal ball told me that the next affadavit will probably 50% or if we are lucky 55%.

Its an interesting move to herd members into accepting their scheme almost by panic - sorry subtle persuasion


SOA vs Windingup & KSFUK Return of Funds

  • Wombat761
  • 30/01/09 20/03/15
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  • Thu, 12/03/2009 - 13:13
  1. One thing DAG planners need to remember is that 9 April is NOT I -Day for the SOA (or winding up). If the Court decides to put the question to creditors, the estimated time -to-decision is extended by at least another Four (4) Weeks according to the Drafty SOA Memos we have so far seen. In that time the Creditors Committee via the court will be sending out Voting Papers for Depositors to consider and return. Voting will be eiher in person or by Proxy.

  2. By 9 April (Easter Eve,) Mike Simpson has stated that Ernst & Young (KSFUK Administrators ) MAY have further information to offer about the likely recovery of KSFIOM Funds deposited with them (Est. Sterling 586 million- MS Affi 20/1/09 ) - See Frog report on 9 /3/09 Q&A with Simpson).. MS's Provisional KSFIOM Balance Sheet as at 8/10/2008 shows this is set-off by some Sterling 165 million owed to KSFUK leaving Est. 402m. Should this become available to the Liq Prov KSFIOM will have potentially 68% of Depositors Funds by end -2009 (incl MS estimate of Stlg 68m returnable from borrowers in current calendar year - See Q&A file a few sessions ago)

Perhaps the next Hearing Date was really set with the above timing in view, as the original UK Statutory Instrument expires on or around 9 April (end of UK Govt moratorium -UKSI2674) .
If the full Stlg 586m became available (probably pipe-dream anytime soon) the recovery by end 2009 could be (586+147+68)m out of 900m or nearer 89% of funds .

So the position by end -09 will be somewhere between 68 & 90% of depositors funds. Unfortunately some of either of these amounts may have to be fought for in the UK courts, so the time (& costs) will become extended.

It therefore seems critical that the Liquidator/Administrator gets full statutory powers to raise any legal challenges seen to be necessary to recover depositors funds from KSFUK, as he would as Liquidator. It is not so certain that he will get such powers under an SOA , without Special Enabling IOMG Legislation (or perhaps regulation.

Finally the Liquidator has stated that the full recovery of the ca. Stlg400 Loans (which are in addition to the KSFUK Deposit ) will take about six (6) Years.. But this seems to leave some margin of error in favour of depositors [assuming they're not all Sub-Prime!].


Timing of return of full % repayment, how can it be end 2009

  • klauseriksen
  • 10/10/08 31/05/09
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  • Thu, 12/03/2009 - 14:31

Its an interesting analysis and may point to some good news with regards to the eventual payout. However with regards to the timing of the funds then I don't understand how all of these would be available by end 2009. As far as I understand it will take several years to return the money from UK, hence the much slower payback calculated in the latest version of the SOA


Timing of Return

  • Wombat761
  • 30/01/09 20/03/15
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  • Sat, 14/03/2009 - 06:03

Its based on the figures quoted in the Frog/MS Q&As over the last few sessions and assumes that the minimum payments from KSFUK will be Stlg 402 as per the Provisional Balance Sheet of 8/10/2008 from Affidavit of MS 20/1/2009 . In the last Q&A Simpson is quoted as having said Stlg 147 was currently available. He also stated that E&Y (the KSFUK administrators ) have suggested they will be free to discuss payuments "after Easter" .

An additional Stlg 68 was stated as being due from Loan repayments by end 2009.
Thus 402+ 147+68 = 616 of an ets. total of Stlg 900 = 68%.


But how do we know all 402 MM will be returned in 2009

  • klauseriksen
  • 10/10/08 31/05/09
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  • Sat, 14/03/2009 - 08:50

I agree with you numbers but your assumption is that we would get all 402 MM from KSFUK and as speedy as by the end of the year.
I don't know what the eventual re-payment percentage would be from KSFUK but I would be highly surprised if it all came back in 2009


SOA vs Winding-Up & KSFUK Return of Fnds

  • Wombat761
  • 30/01/09 20/03/15
  • a depositor
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  • Sat, 14/03/2009 - 13:15

I just raise it as a possibility . If there was , or clearly likely to be , a surplus within KSFUK after repayment of UK-Depositors there should be no reason why the KSFIOM depositors funds should not be repaid, unless the UK Govt is planning something else. As at 27/2/2009 the FSCS says it has repaid 32m to 2200 customers. [[See http://www.fscs.org.uk/consumer/latest_news/2009/feb/]]. I have no inside knowledge, but the moratorium ends on ca. 9/4/2009


@How do we know...

  • IceCrusher
  • 14/10/08 25/10/11
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  • Sat, 14/03/2009 - 10:25

I agree, to assume a 100% return from KSFUK would be overly optimistic IMO.


Ally - SOA - Bank contributions assured?

  • kiwi38
  • 11/10/08 31/05/09
  • unspecified
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  • Tue, 10/03/2009 - 18:52

Ally, do you know (or can you ask Mr Spellman) how many of the Banks have agreed to sign up to and contribute to the proposed SOA? When he was asked this question a few weeks ago in the Tynwald he sidestepped it very evasively which made me think he is having serious difficulties with this issue. Surely after 4 months of having the SOA "on the table" he should have known the answer re Bank support?

Leading on from that quesion do you know what the impact of say 75% / 50% / 25% of the Banks refusing to participate in the SOA would have?

I remain focused on 100% recovery but there is no harm in trying to get fully informed re all options.


Ally - any reply re Bank SOA contributions?

  • kiwi38
  • 11/10/08 31/05/09
  • unspecified
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  • Thu, 12/03/2009 - 10:29

Ally any comment or reply from Mr Spellman re my above posting?


kiwi -was it not reported last week

  • skintagainnow
  • 10/10/08 31/05/09
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  • Thu, 12/03/2009 - 10:48

was it not reported last week that Bell had to admit to Tynwald - that to date no banks had signed up for the SOA.

I'm sure it was in a report somewhere and then posted on the site.


SOA Bank funding

  • kiwi38
  • 11/10/08 31/05/09
  • unspecified
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  • Thu, 12/03/2009 - 11:00

Yes there were more evasive comments and some BS from Bell about him being "confident" but nothing else. I am asking Ally for clarity, via his contact with Mr Spellman, re the status of Bank contributions and specifically what impact various levels of non-committal by the IOM Banks will have on the proposed SOA.

I remain comitted to 100% recovery of our savings but think the answer to this question is worth seeking for display on this public forum at this time.


@ kiwi38

  • Ally
  • 13/10/08 31/05/09
  • unspecified
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  • Thu, 12/03/2009 - 12:35

Kiwi 38

I just haven’t had time this week, been busy with work. This is just a personal opinion so no more weight than that can be given to it. But I don’t think it really matters how many banks sign up to the SoA as IoMG will make good any payments needed for SoA.

Maybe I’m cynical but I think one of the reasons for the SoA is so the banks can “shed” their responsibilities under the DCS and pay nothing or at least less into the SoA and it will all be lost in the SoA workings. Don’t get me wrong I think publicly they need the banks to sign up and look as though this is all a united plan, but personally I think IoMG are budgeting to pay everything.

That is just my opinion only and I have no fact to back it up.

On to a more factual basis and even if they all sign up and agree to make their contributions in full they are paying approx £9.5m a year. I would think how the SoA would work in this scenario is that IoMG will actually pay the money and then claim it back from the banks. I just can’t see the banks funding being important to whether the SoA goes ahead or not.

However I should have more time coming up to the weekend and the beginning of next week so will see if we can get some feedback from someone in IoMG as to the negotiations with the banks.


SOA, Letter to J. Spellman (IOMG) & His Reply

  • mikeexpat
  • 31/10/08 31/05/09
  • a depositor
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  • Sun, 08/03/2009 - 13:47

Please see below my queries Letter to J. Spellman (IOMG) and his replis (JS). Any comments would be appreciated.

Subject: Required Revisions to the proposed SOA.

I am a high value depositor in Kaupthing Singer & Friedlander IoM (presently in provisional liquidation). Assuming only 10% return on pound in the first Liquidator's payment will be more than 50,000 sterling in my case, I will never apply for DCS.
JS: Noted

Please note the only way I would even consider voting for a SOA is if you fulfill the following:

  1. The next version of the SOA includes in writing the rights to be identical to those in the DCS (liquidation). Ability to sue guilty parties etc.
    JS: This is the case.

  2. The next version of the SOA includes conversion of any foreign exchange at a rate in effect at the time the SOA kicks in.
    JS: It is intended that the FX rate issue you refer to is address in the next submission to the Courts.

  3. The IOMG are putting up £150M then let them put it up - full stop. They can have it back once all depositors have received 100%, but not before.
    JS: This not the case. The Government has proposed that it would not seek recovery until all depositors have received at least 60p in the £.

  4. THE FUNDAMENTAL PRINCIPLE OF ANY SOA MUST BE THAT IT GUARANTEES THE SAME OR HIGHER RECOVERY WITHIN THE SAME OR A SHORTER TIME FRAME FOR ALL DEPOSITORS, AS LIQUIDATION DOES.
    JS: The SoA provides the same or a higher return than the liquidation is a shorter time frame than currently proposed by the liquidator. Furthermore, should poorer recovery occur than anticipated then the postponement of recovery by the Government actually improves the return for larger depositors such as yourself. For example, if only 50% was recoverable from the assets then you would benefit from a c10% improvement to overall payout. A calculation tool will be provided in the next week or so in order that you may see the effect.

5.The way the SOA is structured now means that high value depositors are pretty sure to recover 60%. However once the payout reach 60% then the IOM becomes a preferred creditor and claws back all its money before any of the remaining creditors receive anything further. This in effect means the recovery needs to be 100% in order for the larger depositors to receive a percentage > 60% which is equal to the actual recovery. This is not acceptable.
JS: The Government does not become a preferred creditor it simply catches up the recovery that it is due. If the asset realise 70p in the £, that is what the depositors will receive.

  1. For political reasons IOMG increased DCS from 15,000 sterling to 50,000 sterling and is trying to include bond holders. The people who will pay for it are high value retail depositors, especially in dollars and euros. I will never accept it.
    JS: The higher depositors do not pay for the increase in DCS cover. This is paid for by the Government and the banks.

  2. IOMG could support small depositors and bond holders, but not at my cost. I believe that IOMG should show special consideration for high value depositors, like myself, who, whatever happens, will cost nothing IOM taxpayers and for many years created many well paid jobs for the locals.
    JS: Via the Scheme of Arrangement we are attempting to improve the lot for all depositors if possible. Rest assured that it is not a cost to yourself or others like you.

Yours faithfully,
xxxxxxxxxxxxxxxx
Depositor in Kaupthing Singer & Friedlander (IoM)


SOA

  • bobwin
  • 23/12/08 n/a (free)
  • a depositor
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  • Thu, 12/03/2009 - 11:10

Mike Hi

I am glad that you , at least, have realised the implications of this sordid plan.

The EPS 1 & 2 is at the expense of high value depositors--I have said this for some time.

They are even paying bond holders (who would otherwise get a small &age of 50,000 ) under the EPS scheme.

I expect to get my cash back as I have less than 50k--however, as I said before, that don't mean I don't want to screw these bast**ds.

Justice is justice--it costs me nothing but time to blog here, and time I have.

They have spent 530,000 on Alix and add QC Moss and co--that's a million ----for what??

A few pages of drivle--i would have written an SOA in 2 or 3 days for 1000 GBP and be happy.

What Planet are they on--are their back sides worth this much--I don't think so.

we are dealing with a bunch of inbreads--remember that and win!


@mikeexpat: But what have you got?

  • follow_the_tao
  • 11/10/08 31/05/09
  • a depositor
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  • Mon, 09/03/2009 - 10:26

So Spellman slimes his way past your questions.

But tell me what do you get?. If the loan is clawed back, their apparent intention, you actually pay for theit apparent huh "generosity". The time value of money! If they recover the time vakue of money there is no absolute advantage.

Spellman appears to me to being duplicitous. See his proposed broadcast for BBC Moneybox. His error is on the record, Thank God.

I need money right now. Not in the future.


mikeexpat

  • Anonymous
  • Offline
  • Mon, 09/03/2009 - 00:05

Point 1. DCS (liquidation). Liquidation is not some type or accessory of the Depositors Compensation Scheme. You use these two processes as if they are one and the same. They are not. One is merely a compensation scheme. The other is winding up of a company and may be compared to the Scheme of Arrangement.


Q for Mr Spellman

  • Tricky Dicky
  • 24/10/08 30/05/09
  • a depositor
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  • Sun, 08/03/2009 - 13:30

When the possiblility of a SoA was first mooted, in order to give it a fair crack of the whip, it needed to be in a position to be compared alongside the DCS. In fact one of the initial points was that Alix Partners would produce a document that DID compare the 2 schemes side by side.

SOA
To date IOMG have pushed ahead, it must be said at the behest of the Deemster, not under their own direction, to clarify and detail the SoA. To this end IOMG have employed one of the most renown corporate restructuring specialist’s in the world, and Mr Moss supposedly the UK’s leading authority on SoA’s. One would think that after all these experts and 3 months or so, the SoA would be ‘complete’. Yet it still appears that Mr Spellman is still massaging it to make it presentable to DAG members.

DCS
To date IOMG have done nothing to clarify and detail the DCS. Even after the top legal brains on IOM at the last Court Hearing did not understand how the DCS will work in practise, they have done nothing to change this position. Even though IOMG have repeatedly stated that the DCS “has served us well for many years”, it appears to be covered in dust, unused. Can you ask Mr Spellman if he intends to spend a similar amount of IOM taxpayers money on experts in the next 3 weeks to update, clarify and detail the DCS to the same extent as he has for the SoA, or are we expecting the Deemster to delay again on 9th April because there is insufficient detail on the DCS?

As mentioned before I am happy to asisst, if Mr Spellman would agree my terms to be the same as Alix Partners or Mr Moss – I await his reply


@Tricky Dicky: Analyse their 'negotiating' strategy.

  • follow_the_tao
  • 11/10/08 31/05/09
  • a depositor
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  • Mon, 09/03/2009 - 08:42

The thing they fear most is open negotiation.
This isn't their style.
They are playing a closed negotiation strategy.
What do we have to fear from challenging this?
My answer is nothing.
To the light. A spade is a spade.
Everybody is taking a haircut.
The point is how big a haircut.

Unleash the dogs of war.


@follow_the_tao

  • Tricky Dicky
  • 24/10/08 30/05/09
  • a depositor
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  • Mon, 09/03/2009 - 09:55

Thats my point really, it seems Mr Spellman is quite content to "release" clarifications verbally through a select number of our members, but does not appear to want to clarify these points in writing directly with Edwin & Coe our legal team/representatives, which in terms of transparency (which IOM keep banging on about) would be the best route.


Forgot to add ......

  • Tricky Dicky
  • 24/10/08 30/05/09
  • a depositor
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  • Mon, 09/03/2009 - 10:37

Sorry I forgot to add, I believe Mr Spellman is on contract to the IOMG for 2 years, to help forge the way ahead for the IOM Financial Services. So he is not an official of the Government, as I understand it, so what I read here is not the Official IOM Government responses, but Mr Spellmans opinion.

http://www.gov.im/iomfinance/media/cv/johnspellman.xml


Ally, thanks for SoA Q & A

  • Anonymous
  • Offline
  • Sat, 07/03/2009 - 19:17

Your effort to help us understand the SoA is greatly appreciated.


EPS2

  • giveus backourfunds
  • 13/10/08 31/05/09
  • unspecified
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  • Sun, 08/03/2009 - 12:52

Does anyone know for someone with £21K what would happen, Obviously £10k back form EPS1 and EPS2 but how long under SOA would the balance be repaid ?


@giveus backourfunds

  • follow_the_tao
  • 11/10/08 31/05/09
  • a depositor
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  • Mon, 09/03/2009 - 10:30

Read their SoA!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Read David Lovett's affidavits, for God's sake!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!


giveusbackourfunds, re payment under SoA

  • Anonymous
  • Offline
  • Sun, 08/03/2009 - 13:48

We don't have access to the final SoA proposal at present but, referring to the IOM government illustration published at the end of January, there will be 3 minimum lump sum payments under the SoA but none to exceed the total amount owing the depositor. They are as follows-

  • Within 3 months of the SoA being triggered 12.5% topped up if needed to a minimum of £20,000
  • Within the next 9 months 7.5% topped up if needed to a minimum of £15,000
  • Within the next 12 months 15% topped up if needed to a minimum of £15,000

Therefore, if we look at the example you put forward, the first payment of £20,000 to you would be reduced to pay back the £10,000 advanced through the EPS so you would receive only £10,000 at that point leaving just £1,000 still owing you. This you would receive within the next 9 months.

I believe my above example is a true representation of the proposed SoA.


undone eps

  • Anonymous
  • Offline
  • Sun, 08/03/2009 - 23:55

I was wondering when the IoM would recover the EPS 10k. So you think this will be taken out of the first SoA payment? Are you sure? Naturally, I was hoping otherwise: that they would recover the 10k after everybody receives their entitlement up to 50k.


@steenjp: Think 'cheap'.

  • follow_the_tao
  • 11/10/08 31/05/09
  • a depositor
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  • Mon, 09/03/2009 - 10:20

These guys are guarding the farthings (if you are familiar with the currency in the past).

You, apparently along with the majority are misinterpreting their stategy.

IOMG HAVE ONE STRATEGY,ONE GOAL; TO MINIMISE THEIR HAIRCUT. THESE GUYS ARE BEING CYNICALLY AND MANIPULATIVELY "TIGHT". THEIR ACCOUNTANTS ARE SITTING THERE WORKING OUT WHAT IS THE CHEAPEST PACKAGE,. "HOW CAN WE ARRANGE TO PAY THE ABSOLUTE MINIMUM POSSIBLE IN THIS SITUATION, IN ORDER TO COMPENSATE FOR OUR OBVIOUS RESPONSIBILITIES, AND NEGLIGENCE, AND KEEP OUR LOCAL DEPOSITORS HAPPY?

i wait to hear from IoMG's lawyers. I stand by this statement.

You on the other hand seem to to think that what they are offering may be a fair offer. I'm choking here. Get real!


steenjp, re recapture of EPS advance

  • Anonymous
  • Offline
  • Mon, 09/03/2009 - 00:16

Based on the following statement which I extracted from the EPS2 circular published by the IOM government, I gather they will deduct the EPS advance from ANY monies paid out under a DCS or SoA until that advance is paid back in full. I just don't see them waiting to be reimbursed.

"(2) An account holder who makes a claim must also —
(a) execute a memorandum of assignment in favour of the Treasury in respect of his or her right, title and interest in a sum equal to the early payment under this Scheme and agreeing that a sum equal to that early payment can be deducted from any payment received —
(i) from the DCS;
(ii) from the Provisional Liquidators;
(iii) from a liquidator of KSF IOM; or
(iv) from any other person under a scheme of arrangement or compromise under section 152 of the Companies Act 1931 in connection with the restructuring of KSF IOM"


undone eps

  • Anonymous
  • Offline
  • Mon, 09/03/2009 - 00:27

Thank you, undone.

Such recapture undermines the effectiveness of the EPS. Annoying.


Ally, Great post. any word as

  • skintagainnow
  • 10/10/08 31/05/09
  • a depositor
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  • Sat, 07/03/2009 - 19:00

Ally,

Great post.

any word as yet on a possible regular QA session, no suggestion of what they should be doing, just clarifications of the DCS and SOA.


@skint

  • Ally
  • 13/10/08 31/05/09
  • unspecified
  • Offline
  • Sat, 07/03/2009 - 19:18

Skint

We can try and set up a Q&A session if that is what people want, I don't know how far we'll get with it or what format if any it will take.

In a way that is what the informal committee could have done when it was set up before Christmas, but it fell apart for reasons unknow or unexplained.


Any news on the SoA FX rate?

  • columbgc
  • 11/10/08 14/07/10
  • a depositor
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  • Sat, 07/03/2009 - 18:36

Any news on the SoA FX rate? Was this asked?


Any news on the SoA FX rate?

  • Ally
  • 13/10/08 31/05/09
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  • Sat, 07/03/2009 - 18:51

columbgc

No this question was not asked in the list of written questions submitted. It has been mentioned verbally and the repsonse was "it is being looked at".

This is just a personal opinion but I think this is one thing that will be changed in the the next draft of the SoA and a future date be set for fx whether that be 9th April or some other date yet to be decided.


Initial Response

  • Tricky Dicky
  • 24/10/08 30/05/09
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  • Sat, 07/03/2009 - 18:21

Hi Ally,
You say that "Indeed both options currently before us are extremely unpalatable. However come the 9th April, barring any miracles in the meantime, that is the choice that we are going to have to vote on. So any clarification on either is welcome."

According to the report from the Court Hearing, the Deputy Deemster indicated that there were many points of clarification required for the DCS and SoA. It appears initially to me that IOMG are only clarifying points on the SoA, and have not put any effort into clarifying the DCS.
Would you ask your contact to do the same for the DCS as they are doing for the SoA. As your quote says clarification on either is welcome, - I would add that clarification on both is ESSENTIAL.


DCS Legislation Is Crystal Clear

  • jkk
  • 10/10/08 31/05/09
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  • Sun, 08/03/2009 - 13:09

Tricky D,

So far the IoMG and their shills on this site have made every effort to muddle up the issue of DCS, so I would not count too much on them to provide clarification on that subject anytime soon.

But if you look at the original DCS document, you will find that it is a pretty straightforward piece of legislation which needs no further clarification at all. Of particular interest is the funding of the scheme, which the shills describe as non-existent. It turns out that in addition to the banks' contributions and the Treasury's £150 million "The Scheme Manager may borrow money or otherwise incur indebtedness, for the purposes of the Scheme, in such manner and on such terms as it thinks fit."

It means that the Scheme Manager can take a loan to cover any shortfall in funding and pay everyone within the first year of the scheme's existence. Could anybody ask for more?!

That feature is painfully absent in the SoA and that is why they resort to tricks like mixing the monies payable to > £50k depositors with Treasury funding to finance the compensation to smaller depositors. They also extend the process of compensation to three years, hoping the liquidation will produce enough funds in that time to cover the whole scheme with minimum involvement from the Treasury.

It appears that the IoMG panicked after the KSFIoM collapse and have enacted legislation that seems just too generous for their liking now. Anyway, please read the document and see if it really needs any further clarification.

http://www.ksfiomdepositors.org/category/10/666/702


@jkk DCS.

  • follow_the_tao
  • 11/10/08 31/05/09
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  • Mon, 09/03/2009 - 11:48

If the SoA is rejected then---
The IoMG will implement the DCS ina reasonable timely manner whilst denying those above their current the current, vey recently raised (a joke?) DCS limit succour. And what we be that different? The DCS is now budgetted for. The SoA agreement is one off, why couldn't they do it a second time in a slightly different format? The (?)bankers that looted the system still have what surplus was left after the debacle.

And what will be the difference? Thinking for the IoMG, because they don't want to reveal their thought processes, I'd say they were looking at the economic carnage and wondering how they could drop the 60% figure under their current proposal to protect themselves even more. But actually 60% isn't that high. So we go into a recession, Kaupthing wasn't exposed in the same way the more high profile investment banks were, it was, in my opinion a second-rate scam. But then I'm very cynical.

The next step would be to blame the victim. "Our brilliant offer was rejected." (minority) choice.

All this time, talking about the dividend we don't actually get to concentrate on how an apparently solvent bank went down. What was the obviously cognitively captured Apsden doing at the time. As an aside I consider Apsden to be a intellectual moron, just my opinion, given the political and intellectual terrain at the moment Apsden in any Court would be struggling, if not drowning, trying to explain his incompetence.

Does the above make any difference? I don't know. But I do know the 'closed debate' (others' rules) to date have not produced much.

It is my opinion that IOMG is not responding appropriately. Like Guernsey/Jersey it is on thin ice. Let's start stamping.


DCS Legislation Is Crystal Clear???

  • Ally
  • 13/10/08 31/05/09
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  • Sun, 08/03/2009 - 19:09

jkk

In terms of clarity on the DCS I think it does need clarifying especially in terms of funds flow from the IoMG to the DCS. I agree with Tricky Dicky on this, the IoMG should clarify how they could see the DCS working if KSFIoM went in to liquidation and the DCS had to be funded and how quickly they think the DCS would payout the 100% due to sub £50k's and the minimum of £50k to anyone else who claimed.

In terms of the DCS being crystal clear I can’t agree.

”Scheme Manager can take a loan”

It is clear the manager can take a loan but exactly whom is he going to take a loan from? In all probablity it is going to be IoMG or at the very least it would be the IoM Treasury that would have to guarantee such borrowing. So there would need to be clarity from the IoMG as to, a) if they did loan the money how much they would lend and when? or b) if they needed to give a guarantee would they?

Also what would be the rate of interest on such a loan if it was received, as any interest due would have to be paid out of asset recoveries.

It would be good if the world worked in such black and white terms as you seem to think it should, however not many things are so black and white as you would paint them.

The DCS’ funding and the timescales of those fundings are not clear at all.


Ally, are you not ashamed of

  • jkk
  • 10/10/08 31/05/09
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  • Mon, 09/03/2009 - 15:32

Ally, are you not ashamed of yourself? A self-respecting professional man does not peddle such blatant crap to unsuspecting public:

"...what would be the rate of interest on such a loan (...) as any interest due would have to be paid out of asset recoveries."

You either have not read the DCS regulations, or you overlooked the relevant item, because the document could not be more crystal clear in that respect:

"There shall be paid out of the Fund (...) money required for the arrangement, service and repayment of loans obtained by the Scheme Manager..."

I read in Adrienne's latest update that you are selflessly preparing spreadsheets comparing DCS and SoA for our group, but I am somewhat worried now about the accuracy and veracity of those spreadsheets.

I have also received a worrisome info from one of our members, that somebody is leaking privileged information from our group directly to IoMG. Since you are IoM based I believe, would you know by any chance who that somebody might be?


jkk no shame

  • Ally
  • 13/10/08 31/05/09
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  • Mon, 09/03/2009 - 16:56

jkk

I have nothing to be ashamed of. If I have made an error I apologise, it is a good few months since I read the DCS. However even if interest costs are covered the point still stands that still leaves that in all likelihood the loans in the DCS would come from IoMG or be guaranteed by IoM Treasury. So the point still stands that IoMG would have to i) Clarify how much and when they would lend the money or ii) If IoMG would guarantee the loans.

As to the leaking of "pirvilieged information". It always makes me smile when I see this gem. Do you think the IoMG and their advisors would not be able to hazard a very good guess at the actions of some depositors. Some of them have been involved in numerous failures of banks, insurances companies etc. They must have a good idea of the actions and legal actions that creditors would be coming up with. I do't think they would need a spy.

But anyway just to put your mind at rest I have no privileged infomation and I know of no one else who has any, so I can't help you. But just my opinion, I'd stop spending your time looking for a spy as there probably isn't one.

As to the spreadsheet. Well no one is going to make you use it. If you ever get to see it then compare it to the SOA documents and the examples mapped out in Lovett's 3rd affidavit. If you don't agree with the results you can always do your own clacluations. A man of you obvious intelligence would be able to bang out some calculations in a few seconds.

Finally thank you for the good laugh you gave me when I saw the posting, peddling crap!! If I have I apologise and over the months I have never wanted to do that, but to come from you, lol, lol, lol. The words pot, kettle and black spring to mind.


Ally, thank you for putting

  • jkk
  • 10/10/08 31/05/09
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  • Mon, 09/03/2009 - 23:13

Ally, thank you for putting my mind to rest. It is nice to see that you have a sense of humour, as this commodity seems to be in short supply among the other enthusiasts of the SoA.

But I cannot forgive you your post questioning the clarity of the DCS regulations when a day later you openly admit that it has been "a good few months" since you last read them. You are (at least on this forum) a recognised professional in the domain of finance and we all hold you to much higher standards than an average Joe.

I agree with you that I could easily bang out a few calculations myself, but I won't, because they only serve to turn our attention away from the fact that the SoA is a scam conceived to pay us as little as they can get away with, in as long a period of time as possible.

You need no calculations to realise that winding up of a bank is a well established legal procedure administered by an officer of the court, which precludes any access of corrupt officials to our money.

SoA on the other hand is a sophisticated shell game conceived to deceive; to convince the naive that they are getting more in a shorter period of time when in fact they are getting less at a much slower pace.

Ask yourself a question; if the government really wanted to compensate us quicker and better as they say, why would they pay millions to AlixPartners and assorted QC's instead of offering that money to the depositors?


jkk - SoA or DCS

  • Ally
  • 13/10/08 31/05/09
  • unspecified
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  • Tue, 10/03/2009 - 09:05

jkk

I am not an enthusiast of the SoA by a long way. The last draft of the SoA was little more than liquidation by another name, you could argue there might have been some speeding up of payments, but then asset recoveries were on the slow side in the examples. However I believe if the SoA can be improved and certain obvious flaws in it, such as the fx rate, be put right, then I do beleive it could well be a better route than liquidation.

With regard to the the DCS if that is the route we eventually end up going down, I can't help thinking that no matter how clear the regulations may appear there would be plenty of time spent, along with a number of visists to the Courts, to actually get the DCS and its funding in place.

I have spent time trying to explain the SoA as if we have to vote on it then I think its mechanics should be clear to all. Likewise if someone could outline how the DCS and its funding would work and some aspects of it were not clear I would spend time trying to clarify.


Hi Ally, You said above

  • Tricky Dicky
  • 24/10/08 30/05/09
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  • Tue, 10/03/2009 - 09:24

Hi Ally,
You said above "Likewise if someone could outline how the DCS and its funding would work and some aspects of it were not clear I would spend time trying to clarify."

Would you ask any contacts you have in IOMG, when they are going to start this process. I do not believe its a 'job' for members of this DAG to answer or outline anything. The DCS has been in 'operation' on the IOM for many years, and the IOMG have many highly paid experts to do this, its their Scheme - it must be their problem.

I assume it will be clarified before 9th April so that everyone can make an informed decision on both schemes that will be at the same level of detail and calrity.

Would you let us know their response please - thanks


DCS is certainly vague

  • Anonymous
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  • Tue, 10/03/2009 - 13:17

Tricky, like you, Ally and many, many others, I wish the IOM government would set down exactly how the Depositors' Compensation Scheme (DCS) would work in OUR case. As you say, one form or another of the DCS has been in place for many years but to my knowledge it has never been tested, especially in its current form. Not only that, as it isn't even funded, we don't have a clue where the government stands with regards to the talks they claim have or are taking place with the banks regarding their contributions.

I am not suggesting that the SOA, as we currently know it, is much better but there has been much more emphasis placed on analyzing it so at least we have an idea where improvements can be made which hopefully will be included in its final form come April 9th.


@ Tricky Dicky

  • Ally
  • 13/10/08 31/05/09
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  • Tue, 10/03/2009 - 10:23

Tricky

When I said someone, I did mean IoMG, I should have made that clearer. With the SoA they have drawn up a document, which although not very clear at all, I think it can be worked out how it will work. If the IoMG drew up something similar for the DCS I would sit down and work my way through that too. Requests for how the DCS would work have been numerous.


someone

  • Tricky Dicky
  • 24/10/08 30/05/09
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  • Tue, 10/03/2009 - 12:59

Hi Ally,
I did guess it was the IOMG, however, the problem to some extent with an open forum, is that IOMG etc on the SoA can read and understand the members concerns and then 'massage' the scheme to cover those particular concerns.

My major concern here is that when the affadavits come out and it all goes before the Court again on the 9th April, there will be a shining and gleaming SoA, and a dirty, scruffy DCS. In consequence the Deemster may say "thats a pretty looking scheme lets have that one" ie SoA or "we need to delay because the DCS is still unclear and needs clarification"

I can see no reason (I can guess at some though) why both schemes are not being worked on to the same detail simultaneously.


@someone

  • IceCrusher
  • 14/10/08 25/10/11
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  • Tue, 10/03/2009 - 16:25

I don't believe there's a single group out there willing to see any further adjournment of this case - and that includes the Life Cos' as stated by their joint advocate.

Whether the DCS is an untried, dirty, scruffy and/or useless piece of work, it's what's going to get triggered if the SoA does not receive a 'yes' vote. Unless the DAG and others get to see the 'shiny' new SoA well before the Court hearing and make it perfectly clear to Bell and Co straight away that it ''ain't acceptable' there will, IMHO, be no way to get a 'better' (more in the pot) version in time for presentation to the Deemster. I am not advocating either process is acceptable, I am just voicing an opinion based on IoMG responses to DAG efforts to date.


Another day and another

  • expatfrance1
  • 15/10/08 31/05/09
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  • Mon, 09/03/2009 - 15:58

Another day and another conspiracy posting from jkk. Its all getting rather predictable!


I agree expatfrance1

  • skintagainnow
  • 10/10/08 31/05/09
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  • Mon, 09/03/2009 - 16:30

I agree, far too predictable, has the DAG had it's day - probably if this rubbish is allowed to continue.

jkk do you actually know the views of the group you are purporting to represent?


Jkk, I'm not wishing to

  • SgKZ
  • 10/10/08 31/05/09
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  • Mon, 09/03/2009 - 15:49

Jkk, I'm not wishing to insult you, have a go, have a dig or whatever phrase you would like to insert into the sentence, but I would guess from the postings, a number of other people have found Ally's postings very helpful as well as myself.

I'm sure like all of us, he makes mistakes and if he has made some error then try and point it out in a polite manner and not resort to such personal attacks.

Your last paragraph is making a very serious accusation and I for one would not be posting anything against someone without having absolute facts. You run the risk of sounding like our dear old friend Ramsey Peel with his various unfounded 'bung' accusations.

sg


SgKZ, I am glad you decided

  • jkk
  • 10/10/08 31/05/09
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  • Mon, 09/03/2009 - 17:36

SgKZ, I am glad you decided not to resort to insults as that would completely disqualify you as a member of this forum. Do not forget that our common objective is 100% return of our funds and any input that is inconsistent with that goal works to the benefit of those who want to deprive us of our money.

As for the accusations, and "very serious" at that, which you say I made, you seem to be seeing things that just are not there. I would not want to invoke words like paranoia in your context, but try not to forget that sometimes a cigar is just a cigar.


Jkk, The inferrence was

  • SgKZ
  • 10/10/08 31/05/09
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  • Wed, 11/03/2009 - 04:52

Jkk,

The inferrence was pretty blatant in your original final paragraph. I wasn't the only one to read the sub-text.

If your question about Ally knowing who the possible leak might be was a genuine one, then asking it on an open forum wasn't exactly the best way of finding out the info. Do you not agree?

SG