Icelandic Banks - The thread for OFFSHORE savers

redbajan · 9 October 2008 at 3:43PM

I fear that the UK Government might be our only hope and with this in mind I have written to the Treasury the following email - I sure others can do better but I think if we are not to be forgotton in the general chaos we need to do this in numbers:

Email address = [EMAIL="ministers@hm-treasury.gsi.gov.uk"]ministers@hm-treasury.gsi.gov.uk[/EMAIL]

Dear Minister,

I appreciate that the Treasury does not have responsiblity over IOM banking affairs but for the following reason I would seek your department"s assistance.

We as many other savers in the KSF IOM are UK citizens although non-resident due to work.
We therefore pay UK taxes on our UK incomes.
Kaupthing, Singer and Freidlander IOM was purchased within the last year from a UK mutual (Derbyshire Building Society) and it was with them that my account was opened.
The UK's actions, which I support (with regard to Iceland"s actions towards UK savers) has directly led to KSF IOM's fall into administation.
UK takes responsibility for foreign affairs and as such I hope the interest of KSF IOM savers will be included in the UK's actions against Iceland.

So for those reasons I would be grateful if you would use your influence to ensure the following:

1. Kaupthing LTD (UK) debts to KSF IOM are repaid to KSF IOM to ensure our savings in the IOM.
2. Pressure be put on the Iceland Government to ensure that KSF IOM and its savers are afforded the same 100% protection as Icelandic residents have been granted.
3. That all funds transferred out of KSF IOM to UK bank accounts in the last week are allowed to be processed and not blocked as part of the action against Iceland.
4. That assistance is offered to the IOM Government to assist in a sale of the KSF IOM to another bank or failing that assistance in seeking guarantees from the Icelandic Government.
5. If IMF or EU support is to be given to Iceland I would hope that this is made conditional on Iceland meeting its international commitments including savers.

Best regards,

Monkeyface3604 · 9 October 2008 at 3:45PM

Macbiggles, Many thanks for your reply, guess its something else to consider, sad to hear its unlikely to cover your bonds though.

Has anyone heard any rumours about who these banks showing interest may be?

Knife_Edge · 9 October 2008 at 3:57PM

@redbajan - wish I'd seen yours before I sent this in earlier today, it's better than my effort, but FWIW, here is my e-mail to the Treasury

Dear Mr Darling

I am writing to you following the announcement that Kaupthing Singer & Friedlander (Isle of Man) Limited (KSFIOM) is being wound up. This announcement was made on the Isle of Man's regulator's site earlier today[1].

This winding-up is obviously causing a lot of innocent people a great deal of distress. Many of those are UK passport holders and you can see some of their stories on:

http://www.moneysupermarket.com/community/forums/t/kaupthing-singer-amp-friedlander-iom-isle-of-man-25211.aspx?PageIndex=4
http://forums.moneysavingexpert.com/showthread.html?p=14835053&posted=1#post14835053

Most people hold accounts here because opening an account in a UK high street bank is not possible as they require a UK address.

I first heard of KSFIOM through the Kaupthing Singer & Friedlander UK website, which markets KSFIOM as part of the Kaupthing Singer & Friedlander Group plc group of companies - as shown at http://www.kaupthingsingers.co.uk/ksfgroup at 9.30am this morning. I was alarmed at the recent speculation surrounding the viability of Kaupthing Bank and subsequently discovered that it was a subsidiary of the Icelandic parent, subject to Isle of Man regulation and therefore not included in the recently-arranged sale of Kaupthing's FSA-regulated assets to ING.

The Tynwald in the Isle of Man is currently discussing raising the depositor protection scheme limit from its current £15,000 to £50,000. It is not clear to me whether this will be retroactive or not. It is clear that this will be insufficient to cover many people's loss of their lifetime savings and that the IOM funding arrangements for their scheme mean that payments will be made over a significant period of time (I understand the scheme has only recently made the final payment following the collapse of BCCI in 1991).

There is a complete lack of communication on the part of KSFIOM or the Manx authorities on this matter, who seem to be overwhelmed by the current situation.

Can I implore you to extend the UK savings guarantee to depositors in the Crown Dependency of the Isle of Man?

I look forward to hearing from you

occamsrazor · 9 October 2008 at 3:57PM

Monkeyface3604 wrote: »

Has anyone heard any rumours about who these banks showing interest may be?

Nope. And frankly I don't care who buys it - as long as we don't lose our savings! I still think a buyout is the best option for all of us.

wtf_2-2 · 9 October 2008 at 4:05PM

@Redbajan - I've slightly edited your doc (spelling, non-Derbyshire and UK resident) and sent it along too.

Thanks for putting the points succinctly

occamsrazor · 9 October 2008 at 4:11PM

Here's what I wrote (taking from redbajan's letter):

Dear Minister,

I understand that the Treasury isn't responsible for Isle of Man affairs but I am writing to hope it will at least consider using its influence to help British citizens who had accounts with Kaupthing Singer & Friedlander (Isle of Man) who are now facing the loss of their savings.

Many of us are British expats who were forced offshore by the UK banks who will no longer open accounts for non-residents due to money-laundering regulations. We wanted to keep our money in the UK but couldn't.

While customers of Kaupthing's UK operation have had their deposits fully protected, British citizens with accounts in the Isle of Man are now facing ruin and losing their lifetime savings.

I understand one of the reasons the Isle of Man operation was forced into liquidation is that loans it made to the UK arm could not be repaid, therefore in my opinion the fate of Isle of Man customers is inextricably linked to the UK.

For those reasons I would be most grateful if you would use your influence to ensure the following:

1. Kaupthing LTD (UK) debts to KSF IOM are repaid to KSF IOM to ensure our savings in the IOM.
2. Pressure be put on the Iceland Government to ensure that KSF IOM and its savers are afforded the same 100% protection as Icelandic residents have been granted.
3. That all funds transferred out of KSF IOM to UK bank accounts in the last week are allowed to be processed and not blocked as part of the action against Iceland.
4. That assistance is offered to the IOM Government to achieve a sale of the KSF IOM to another bank or failing that assistance in seeking guarantees from the Icelandic Government.
5. If IMF or EU support is to be given to Iceland I would hope that this is made conditional on Iceland meeting its international commitments including savers in the Isle of Man.

Thank you.

Monkeyface3604 · 9 October 2008 at 4:13PM

Red, i have sent one too. I implore veryone to send letters to as many MP's and such forth as we can. We need to get the discussions of the internet and into places that really count.

phoebe36 · 9 October 2008 at 4:17PM

occamsrazor wrote: »

(Edited 9th Oct ) This thread is about Offshore accounts with Icelandic banks such as Landsbanki Guernsey and Kaupthing Isle of Man - not about UK accounts. There were previously one or two other threads about offshore accounts - please now keep all posts about offshore accounts with Icelandic banks on this thread so we can keep all the information in one place and make it easier for people to follow developments.
Thanks.

Despite the recent bad news about Icelandic banks, UK savers at least have the UK FSCS £50k protection to reassure them. This thread is for savers of Icelandic banks (and others I guess) with accounts based in the Isle of Man (IOM), Jersey, Guernsey, etc - all of which are not covered by the UK compensation scheme. There are many reasons why some people have accounts with these banks but one important one is that many savers have been forced to go offshore because most UK-based banks will no longer open accounts for non-UK-residents - e.g. British expats.

Jersey & Guernsey have no depositor compensation schemes I am aware of.

The Isle of Man depositor's compensation scheme is this: "The DCS compensates people who have money in current and deposit accounts in the Isle of Man with 75% of up to £20,000 of net deposits per depositor per bank, if the bank fails. This means maximum compensation payable is £15,000 per depositor – this amount would be paid to someone with £20,000 or more."

http://www.gov.im/FSC/investor/dep_comp.xml

In the case of Kaupthing's Isle of Man operation - Kaupthing Singer and Friedlander (Isle Of Man) Limited is a wholly owned subsidiary of the Kaupthing parent company Kaupthing Bank hf, and all funds are also guaranteed 100% by them (for what that's worth).

http://www.kaupthingsingers.co.im/about-us/kaupthing
http://www.kaupthingedge.co.im/About/KaupthingBank.aspx

Personally I have been very happy with the really outstanding service (especially by telephone) of Kaupthing IOM. The service is by far the best I have received from any bank I have ever dealt with.

However the Isle of Man depositor's compensation scheme is weak compared to the UK one, and this concerns me.

What are the implications of the recent events and guarantees etc for us offshore savers?

Do any of the guarantees of the subsidiary by the parent company entitle us also to compensation under the parent company's home-country scheme e.g. the Icelandic scheme in the case of Kaupthing?

Any other thoughts?

Seems to me that the Kaupthing Bank Hf guarantee ought to be enforceable by the liquidator. Question then is what is that worth now that the Icelandic govt has taken over the bank. Don't see how they can avoid that liability - they don't just take on the good bits but also assume liability for the bad bits. So if the Icelandic compensation scheme will not kick in (which given Iceland's huff about other countries not helping it out when it was looking for funds and had to go to Russia seems unlikely) liquidator would have to sue Iceland govt.

We have deposits placed through a bond with Royal Skandia in IOM. RS say they are not entitled to participate in the compensation scheme so our money (not RS's) is unprotected in its entirety and we are at mercy of the liquidator recovering what he can. There seems no logic to that. Has anyone had similar response from RS?

occamsrazor · 9 October 2008 at 4:19PM

Monkeyface3604 wrote: »

We need to get the discussions of the internet and into places that really count.

...which is the mass media to pick up on the fact that British citizens are facing a loss of their saving. Over on the thread at moneysupermarket.com a researcher from Channel 4 news made a post looking for people to tell their stories with the Icelandic banks (not specifically Isle of Man, but they posted on that thread so presumably they are open to such customers). If you want to participate, this is how to get in touch with them:

--

If you would like to speak to Channel 4 News regarding your story, please email [EMAIL="casestudy@moneysupermarket.com"]casestudy@moneysupermarket.com[/EMAIL]
You can also contact me directly on the email address below.Many thanks
Cheers,
Graeme Delap, Community Editor,
graeme.delap @ moneysupermarket.com (remove the spaces!)

http://www.moneysupermarket.com/community/forums/t/kaupthing-singer-amp-friedlander-iom-isle-of-man-25211.aspx?PageIndex=7

Estes · 9 October 2008 at 4:22PM

Red thank you for that my partner and I have sent one each off too. Would it be worth getting friends and family who may not have deposits in the KSF IOM to also sent in copies. They may not be directly affected but indirectly surely support of numbers can only help us.

Thank you all for your continued positivity during a very distressing time. We were due to finalise on a house by the end of the week and our cash payment was set up for sending yesterday! I guess that wont be happening and we will need to start from scratch again! but lets keep working together to try and get a positive outcome to this nightmare.

Icelandic Banks - The thread for OFFSHORE savers

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