The Real Message from the latest Coutts / AIG £748M bailout ?

2sides2everystory

Yes folks, if you missed it, the message you were supposed to hear in this morning's news was that the FSA has fined Coutts £6.5M for daring to sell top people products tied up in AIG bonds (remember AIG was the massive American Insurance Group that would have toppled like another Building 7 after Lehmans was demolished had not the US government stepped in with 180BN dollars and took control of a very sick duck just like the UK government ended up with another sick duck RBS ?

Well the message you may have missed behind the smokescreen of the FSA fine is that it is now official that the non-performance of bonds issued by the American government owned AIG will now be be bailed out to the tune of £748M not by the US government, but at this end by the UK government owned (that's us taxpayers) RBS who own Coutts which as we know is the top people's bank - top people who had their fingers in pies that were stacked in such a way that they didn't actually lose much at all in the crisis - certainly not now.

Is this the Special Relationship in action? Another redistribution of all our wealth for the benefit of the few ?

oldvicar

Jeremy Clarkson will be so pleased (yes he had such investments from Coutts).

Madness!

Uncertain

Why is somebody less deserving of compensation because they are rich or a "top person" as you put it?

The same rules should apply to everybody. If the product was mis-sold (as nearly everything offered by banks seems to be !!) then the bank should be made to pay.

Who owns the bank (in this case the taxpayer) or how wealthy the customer is should have nothing to do with it.

Whether the tax payer should have bailed out the bank and become the owner is of course another matter.

2sides2everystory

Well clearly there are special investment services uniquely available to top people (and we are talking just 247 Coutts customers here) so rather than the taxpayer bailing them out as a last resort, don't you think their investments should simply be allowed to fail with the natural-market-forces-driven redistribution of wealth to the "winners" just like has happened to our pensions ?

£748M/247 = £3M each. Tough titty I say if they took the best investment advice the country has to offer and it failed them personally. Diddums.

What about my £300,000 pension fund that is only £150,000 now? Who is prosecuting a case for getting me and ten million others a compensation for that ? Get me and the other main tent pension savers theirs back and I might be prepared to help those poor 247 unfortunates.

Are you Clarkson ?

Who owns the bank (in this case the taxpayer) or how wealthy the customer is should have nothing to do with it.

Yes go tell that one outside St Pauls on your tent cover - or maybe you don't do tents, only lacy marquees on pristine lawns by invitation only and special services on the gate too? Gawd help you if they ever fail come the revolution.

Uncertain

2sides2everystory wrote: »

What about my £300,000 pension fund that is only £150,000 now? Who is prosecuting a case for getting me and ten million others a compensation for that ? Get me and the other main tent pension savers theirs back and I might be prepared to help those poor 247 unfortunates.

These "top people" will no doubt have other investments that have fallen in value by a similar proportion to you pension fund or maybe even more.

You cannot generally claim compensation just because an investment has done badly. If you were mis-sold the investment of if the investment was mis-categorised then you may well have a claim.

Were you?

If so then get a claim in.

If not, then you chose to take a risk on investments which could fall in value in the hope of getting a better return. If you weren't willing to take that risk they you should have invested in something with a capital guarantee.

More relevant is this....

Does your current £150K value represent a reasonable return on your investment overall? The fact that it was "worth" £300K on some arbitrary date a few years back is largely irrelevant. Presumably you could have transferred it then to some much lower risk fund and pegged you gains? Why didn't you? Probably because like most of us you haven't got a crystal ball. What you did have was rose tinted spectacles!

Uncertain

2sides2everystory wrote: »

Well clearly there are special investment services uniquely available to top people (and we are talking just 247 Coutts customers here) so rather than the taxpayer bailing them out as a last resort, don't you think their investments should simply be allowed to fail with the natural-market-forces-driven

No I don't.

They should get exactly the same protection (or lack of it) as anybody else.

Suppose some "ordinary" person had their life savings of say £25K in the same fund. What would happen to them according to you?

Where do you draw the line?

2sides2everystory

Uncertain wrote: »

These "top people" will no doubt have other investments that have fallen in value by a similar proportion to you pension fund or maybe even more.

Do you mean to assert that that they are long-suffering like the rest of us? Or perhaps that if their connections were not absolute top notch then they may have missed the cut when the elite creamed off their killing ? :rotfl:

You cannot generally claim compensation just because an investment has done badly.

Oh really? Unless you are one of the 247 hangers on you mean or of other select top peoples' groups that manage to play a blinder in the bail out game? I.e. "Thanks for your support. Hang on in there chaps and chapesses and we'll be back to rescue you by fair means or foul - all part of the service dontcha know" ???

Suppose some "ordinary" person had their life savings of say £25K in the same fund.

Are you serious? The average investment in this group of 247 investors was £3M. Are you really trying to have MSE readers believe that there is someone in that group who is a Coutts customer and that their life savings pre-crisis amounted to a measly twenty five thousand quid? How on earth did they make it through Coutts front door? Talk about wolves going about in sheep's clothing ... You wish !

Uncertain

So how does your signature work with the super rich you seem to despise so much then?

"No two ways about this one:
A Free University Education is a Basic Right"

Still should be free if Daddy has got millions? (free of course means paid by the tax payer)

Presumably not as you seem to think that rights and protection should drop with wealth.

2sides2everystory

Still should be free if Daddy has got millions?

Yes because a university education is not about who Daddy is or what he has accumulated.

ukmike

remember AIG was the massive American Insurance Group

or even the American International Group

Linton

A bit of an ignorant rant I think...

If you read the reports you will see that the compensation is not because the value of the investments fell, but rather that Coutts sold the fund as an alternative to a building society deposit, which as events showed it wasnt.

Now please enlighten us. How did you manage to get a 50% loss in your pension fund?? I mean, it was just about doable at the depths of the credit crunch with some over risky investing, but that has mostly recovered. How is it you are still showing such a loss???