Press Releases

PRESS RELEASE 24 October 2008

WAS THE UK REGULATOR IMPLICATED IN ICELANDIC BANKING CRISIS?

Questions are being asked about the FSA's role in the banking crisis on the Isle of Man.

The FSA, officially, has no jurisdiction in the Isle of Man but stories are emerging that seem to indicate significant involvement in the crisis now engulfing the island. John Aspden, Chief Executive of the Financial Supervision Committee (FSC) on the Isle of Man, confirmed yesterday that the Isle of Man regulator had instructed Kaupthing Singer & Friedlander Isle of Man (KSFIOM) to move assets from Iceland to London when it received unfavourable reports on the Icelandic economy. What is as yet unclear is where and when the FSC got these reports.

Sources in the Isle of Man are indicating that the transfer of funds was carried out on advice from the FSA who suggested London as a ‘safe haven’ should the Icelandic economy collapse. This course of actions proved fatal for KSFIOM as the FSA then went on to seize these assets in London on 8 October.

Why did the FSA recommend London? Why were these assets not protected in the UK?

Did the FSA know that they would be seized in a time of crisis?