The Cyprus Situation

aardvaak

Could this happen in this country?

Totton

Yes it could but quite unlikely to be as transparent. Some say that we have already suffered a greater loss than the Cypriot depositors in that the value of our cash has declined some 25% or so whereas they will probably 'just' lose 20% above the equivalent of £85k. The moral of the story appears to be ' Don't save in a bank'

mulronie

It would probably help if you narrowed down the "situation":

• Government fiscal implosion?
• Proposed levy on all bank deposits?
• Glorious sunshine 11 months of the year?

I can only guarantee that one of the above is absolutely impossible here....

cardigan

Can someone who can explain the law that makes it legal for a government to take money from a bank account?

Is that law specific to cash or can it be applied to savings in gold, shares etc.?

How does that law make it legal to take 20% off savers in bank A and only 4% of savers in bank B?

Is that law specific to banks e.g. if the savings were under the bed could they take 20% of that?

Is that law a Cyprus law, and EU law, a Bank law, a Global law?

innovate

Governments can impose any taxes they see fit. This could include a wealth tax, where wealth could include investments and savings. Whether governments would survive the introduction of all taxes is an entirely different question.

jimjames

mulronie wrote: »

It would probably help if you narrowed down the "situation":

• Government fiscal implosion?
• Proposed levy on all bank deposits?
• Glorious sunshine 11 months of the year?

I can only guarantee that one of the above is absolutely impossible here....

It would be nice if no 3 happened in at least 1 month of the year!

cardigan wrote: »

Can someone who can explain the law that makes it legal for a government to take money from a bank account?

Any government can pass a law to do something to affect their citizens whether it be taxing them for holding certain assets or confiscating assets. There is a proceeds of crime bill that already allows confiscation if you cannot prove how you obtained money.

bigadaj

I liked the quote from a guy in the city. There's the area of Europe you go on holiday to, and the area of Europe you invest in, and they are totally different areas.

cardigan

I am not a lawyer but I did do A level law and yes it was 25years ago but I recall being taught that overarching all laws was a concept of 'Natural Law' and 'Natural Justice' and that precept was that a law had to fairand that courts could rule that a law wasn't fair and consequently unlawful. And . . . it seems to me unarguable that it can be fairto impose Tax A on people with deposits in Bank A and Tax B on people withdeposits in Bank B.

talexuser

We have no written constitution and very little inherent rights compared to say the USA, and are still subjects (to the crown) rather than citizens in the UK. Most of our rights come from the European Human Rights Bill (as does most of our consumer protection come from Europe laws, including the £85000 limit which would otherwise still be 50k).

Glen_Clark

aardvaak wrote: »

Could this happen in this country?

It already has, and far more than that proposed in Cyprus. But its done surreptitiously by printing money, devaluing the currency, and stoking up inflation. (the pound has fallen about 20% against the Euro since the Euro was introduced, Cypriot savers have been getting 5.5% interest, compared to less than 2% for UK savers.)
Unlike Britain, Cyprus cannot print money because its in the Euro, so if it wants to raid savers bank accounts it has to do it openly and honestly - creating widespread horror because savers can actually see what the Government is doing.
Aren't we fortunate to have our wonderful Sovereignty and the plummeting pound

cardigan

talexuser wrote: »

We have no written constitution and very little inherent rights QUOTE]

That's not quite correct.

We have Common Law. The difference between a Constitution and Common Law (as I recall) is that a Constitution is somewhat prescriptivea nd Common Law is interpreted i.e. that courts define the law based upon, accepted Common Law, the written law and the precedents set by previous courts. Bye the by, call it what you like but we do have laws and in this country (and Cyprus law is based upon UK law) the Government can do what the hell it likes but the courts can overturn it if it contravenes Natural Justice.