Members of a group of depositors who were caught up in the collapse of Guernsey's Landsbanki branch in 2008 are calling attention to comments in a recent UK Justice Committee report that they say proves their claims the situation was badly handled.
The report “shows the government of Guernsey in a very bad light insofar as its actions – or rather, inactions – in managing [Guernsey Landsbanki’s] failure in 2008,” said Mark Ashbey, a depositor and also a member of the Landsbank Guernsey Depositors Action Group, which represents 1,600 British depositors, many of them pensioners, who had an estimated £120m on deposit in the Guernsey-regulated bank when it failed. . . .
Among the Justice Committee's recommendations were that the Ministry of Justice "consider alternative models for the representation of the interests of the Crown Dependencies internationally."
"It is imperative that a means is found by which the islands are represented effectively, and we strongly recommend that certain officials, either from the UK or from the islands, be specifically designated as representing the islands in international negoations," the report notes. International Adviser website - o8-Apr-10.
A group representing Landsbanki Guernsey depositors said it feels vindicated by a report looking at the island's relationship with the UK.
The Justice Committee's review included evidence of how the collapse of Landsbanki was handled.
A States of Guernsey submission stated the UK government prioritised its own interests over those of Guernsey when dealing with Icelandic authorities.
The depositors agreed their interests were not considered throughout.
Since October 2008 the Landsbanki Guernsey Depositors Action Group has lobbied the States to do more to help them.
Depositors have previously been told by the administrator to expect up to 91% of their money back. 01-Apr-10.
The world may have moved on, but some depositors caught up in the Icelandic banking collapse are still waiting for compensation.
Some 67 MPs have signed an Early Day Motion for the Government to define who's responsible for dealing with the £500 million lost by savers in Kaupthing Singer and Friedlander Isle of Man.
The Isle of Man regulator says: “Not us guv. The FSA and HMG told us to move the money to the UK.”
The FSA and Treasury say: “Depositors in the Isle of Man are covered by the Isle of Man regulator” — a right muddle in other words.
Many of those who lost their money are British expats who wanted to use a UK bank, but if you don't live here you can't have a UK bank account. The advice of the FSA has always been therefore to “use a UK bank in an offshore dependency” — like the Isle of Man, in fact.
So you do as they say, your money goes up in smoke, and then you sit in regulatory no-man's land with nobody prepared to address the issue with any urgency! City Spy - Business Section - London Evening Standard website - 24-Mar-10.
Right up to days before Landsbanki Guernsey collapsed in October 2008 the Guernsey Financial Services Commission had been reassuring concerned Landsbanki Guernsey savers enquiring by telephone that they need not fear for their savings because a 100% Parental Guarantee was in place. Indeed the Parental Guarantee had long been Guernsey's primary marketing tool to attract retail deposits to bolster its finance centre. Now that Landsbanki's Winding Up Board in Reykjavik has made abundantly clear that it is refusing to recognise any sort of guarantee, the GFSC appears to have changed its tune: it is telling enquirers that a Parental Guarantee was never a requirement and that - even if one were in place - it would not be legally binding. The question that springs to mind is: could savers be forgiven for thinking that the GFSC is being disingenuous? . . .
Now they are informing depositors who have lost life's savings that they should have read this obscure and very technical Consultation Paper and, by implication, should have moved their savings elsewhere. It was their own fault. Is the GFSC being disingenuous? What do you think? 12-Mar-10.
The Guernsey financial regulator has told consumers it is up to them to read banks' financial accounts to check if it is safe to deposit their savings.
Offshore savers are financially sophisticated and should be expected to study the finances of the island's banks to see it they are safe, according to the Guernsey Financial Services Commission (GFSC). The warning comes after the collapse of Landsbanki Guernsey in October 2008, which streamed money backed to its parent onshore bank leaving its offshore savers out of pocket. . .
The advice from the GFSC has been ridiculed by one offshore saver. ‘It begs the rather obvious question: what on earth is the regulator for, if they're telling the public ‘figure it out for yourself.' 12-Mar-10.
LANDSBANKI Guernsey depositors are the worst-affected by the Icelandic financial crash, and Iceland may now never re-compensate [sic] the UK, it has been claimed.
Hundreds of thousands of Iceland residents have joined an insurrection proposing that the UK and Netherlands, which lent the country the money to bail out foreign savers when Landsbanki collapsed in October 2008, should not be recompensed.
Over the past year they have become increasingly unhappy about bearing this cost saying it will make their already huge debt impossible.
An article in the Sunday Telegraph business section yesterday said that of all those affected, one group of Channel Islanders was hit hardest.
‘But the worst affected people – even more so than Icelandic and British taxpayers – are the 800 savers in Landsbanki Guernsey who lost access to their entire life savings,’ said business journalist Rowena Mason.
‘They were not covered by the UK Government’s bail-out,’ she added. 08-Mar-10.
[See referenced Telegraph article by Rowena Mason HERE.
The long awaited ‘Black Report’ into Iceland’s economic crisis is set to be delayed once again due to the long responses received from implicated parties.
The report by the Althingi investigation committee will be delayed by a further two to three weeks while committee members go over the more than 500 pages of answers received from the 12 current and former public officials formally invited to reply to committee accusations before publication of the report.
The report was originally scheduled for release last autumn and then delayed until the beginning of February, then the beginning of March and now, again, until two to three weeks into March, RUV reports. This time, the committee has not committed itself to a specific date.
A statement from the committee stated that the answers received represent the final materials needed and all that remains to do is to correlate the findings and print the extensive document. At this stage it is already logistically impossible to release it before the 11th March. 27-Feb-10.
RECOVERING Landsbanki depositors’ money is down to the administrators, not the States, according to the chief minister. . .
Landsbanki Guernsey savers have accused the Guernsey Financial Services Commission of allowing the bank to advertise a worthless parental guarantee.
It follows the Icelandic Winding-up Board rejecting savers’ claims because Landsbanki Guernsey did not have a guarantee from its Icelandic parent company to back its deposits. . .
The GFSC does require subsidiary banks to have letters of comfort in place but it has always recognised that these are not legally binding and made that point plainly in the same consultation paper. . .
‘It is clearly incorrect for the LGDAG to “question the validity” of the chief minister’s recent assurances that Landsbanki Guernsey depositors would be treated fairly by the Winding-Up Board, as claimed by the LGDAG. I regrettably cannot do anything other than to express my disappointment that the LGDAG has sought to personalise the matter and in doing so misrepresent our position.’
Guernsey savers have so far had a little over two thirds of their money back. 22-Feb-10.
DEPOSITORS in a Guernsey bank that went bust are angry that a guarantee from its Icelandic parent now appears not to be worth the paper it was written on.
Earlier this week the winding up board for Landsbanki’s affairs in Iceland rejected depositors’ claims under the Guernsey bank’s parental guarantee. And the people who banked at Landsbanki Guernsey are now accusing the Guernsey Financial Services Commission of not doing its job properly.
A group representing the Jesey and Guernsey depositors said that the regulator allowed the bank to advertise a parental guarantee to potential customers that has not now been honoured. They also say that recent assurances given by Guernsey Chief Minister Lyndon Trott, that depositors would be treated fairly by the winding up board, were worthless.
The group is calling for an independent public inquiry to investigate what went wrong and to hold people to account.
About 100 Jersey depositors are still owed about £2 million after the bank failed in October 2008. Over a period of time, they have been repaid chunks of their savings and have so far got back about two thirds. 20-Feb-10.
Iceland will meet Britain and the Netherlands in London on Monday to present a new proposal for repaying more than $5 billion (3.2 billion pounds) lost in Icelandic bank accounts, sources familiar with the plans said. . .
A Icelandic government source has said the new proposal involves quicker repayment of the country's debt from a sale of the assets of failed bank Landsbanki.
A spokesman at Iceland's finance ministry said the government hoped to present the new proposal "very soon."
One creditor nation source said he "could not rule out" that the talks would stretch more than one day.
The source also said the talks were not likely to be at the highest levels, particularly as European Union finance ministers are meeting early this week to focus on the public debt crisis in Greece. IBTimes website - 15-Feb-10.