Kent Council Deposited £Millions with Icelandic banks despite warnings on 30th September 2008

Posted 17/12/2008 - 01:26 by steveejeb

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2008-12-17 (All day)

Kent County Council invested £50m in Icelandic banks which collapsed
A local authority deposited £3m in an Icelandic bank a day after being warned against it, a report has revealed.
Kent County Council, the UK's largest council investor in troubled Icelandic banks, had £50m deposited in Landsbanki, Heritable and Glitnir Bank.
A report by Price Waterhouse Cooper (PWC) said the council was sent an e-mail warning them that Heritable Bank was no longer a sound investment.
The council said a staff member did not read the email until it was too late.
The e-mail was sent by a financial advisor at 1500 BST on 30 September to a junior officer at the council.
'Not malicious'
The review of treasury management procedures carried out by PWC said: "A human error resulted in an e-mail containing the information not being read and processed in time."
It said that the latest information on recommended investments should be sent to several people to "ensure timely updating" in future.
The rest of the £50m had been deposited or contracted when the council believed the banks were safe based on advice from its financial advisors, the report added.
Councillor Nick Shard said: "There will be disciplinary action against the individual.
"This is not fraud, this is not malicious, this is human error."
The council had £17m invested in Landsbanki, a further £18.35m in its UK subsidiary Heritable, and £15m in Glitnir Bank. All three banks collapsed in October.
More than 100 local authorities in the UK had more than £800m in Icelandic banks.