Kaupthing chief blames Icelandic government for financial meltdown

Oct 10, 2008 | Posted by: roboblogger | Full story: Telegraph.co.uk

The chairman of Kaupthing blamed the Icelandic government for ruining the island's entire financial system after his bank became the third to be nationalised in three days.

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1 - 7 of 7 Comments Last updated Sep 7, 2009
Anthony Gross

London, UK

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#1
Oct 12, 2008
 
Hello, this is to let everyone know that I contacted all the press about Kaupthig IOM and was just interviewed on the phone. That the interview will go out on most radio stations nationally tomorrow Monday 13th.
The subject is that I am an individual UK saver who lost my savings of 30,000 in Kaupthing IOM. I spoke about how the UK government seized the banks assets forcing a collapse and I also spoke about how these high interest products were of course very attractive and lured many people like me only to - in retropect - to be funding another country's debt repayment.
Hopefully this will draw attention to the plight of individual savers and force the government to take our case on board. 100% of all savings should be paid back - not just up to a limit of 50,000 - and in a very short time scale. I can imagine how traumatic this must be for some people who have lost everything.
Kind regards
Anthony Gross
Klaus Eriksen

Azerbaijan

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#2
Oct 12, 2008
 
Currently the IOM maximum compensation is 50,000. However they don't tell you how they intend to finance it. Here is the real story behind the compensation scheme. IOM intend to have some of its 37 banks or so (I read somewhere it will be 7 but this is unconfirmed) each pay in 500,000 annually to a fund that will thereafter be distributed to the depositors. The current balance of this fund is zero. A little match quickly reveals with the hundreds of millions that eventually is to be paid out it will take decades if not centuries to pay even the minimum 50,000. Hence it is a smoke screen when the IOM states that they have brought their compensation scheme up to the UK standards. The IOM is merely trying to avoid a run on the banks in IOM.
Also what is amazing to me is that when the UK treasury froze the KSF UK subsidiary they effectively froze 60% of the deposits in the IOM subsidiary hence causing or at the very least speeding up the collapse of the KSF in the Isle of Man. The big question is what will happen to the KSF IOM funds that currently reside in the frozen UK subsidiary, will these funds be used to finance the generous 100% compensation scheme the UK has guaranteed. One thing is clear the Isle of Man government is clearly in over its head and there is a significant chance that all us IOM depositors will be left out in the cold while the UK concentrate on more political expedient causes of action for the UK mainland depositors.
S J Hulme Taiwan

Taipei, Taiwan

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#3
Oct 13, 2008
 
I agree with you Anthony Gross / I am also a UK national who moved 24,000-00 GBP to Kaupthing IOM to have a small monthly income as I could not find a UK Mainland bank who would let me open a higher interest rate account. Gordon Brown has a lot to answer for and should include the IOM savers in the whole Kaupthing package deal. After all, it appears it was mostly our funds on loan to the UK division, which were seized. Although the IOM has raised the compensation scheme, I still expect a run on IOM banks, commencing today, as there is still no information on how they will fund the compensation to depositor's quickly and efficiently, as on the UK mainland. The IOM government has to have some quick deal with Gordon Brown, to avoid an island wide rush on the banks, the likes of which have never been seen before and the UK banks will either have to return funds or let them fall. Whatever happens, a very possible scary time for depositors.
bellyup

Worthing, Barbados

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#4
Jul 13, 2009
 
After 9 long months KSFIOM has gone into liquidation.

People who have less that 50k will hopefully get their money within a month or two.

The IOM has done its best not to trigger its DSC scheme hence the long wait while it tried to foist its SOA ( scheme of Arrangement ) on the depositors.
This was rejected as it took away all of their rights and was only slightly - so they said -advantageous to those with less that 50k.

Anyone above this sum it was distinctly disadvantageous.

the depositors have been left in limbo and silence while the powers that be pretend it never happened
bellyup

Bayville, Barbados

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#5
Aug 9, 2009
 
The KSFIOM disaster is proving to be the biggest cover up involving both the IOM and UK Governments.
Nine months have passed and the depositors have still not got their savings back.

Worse things have got daily more and more murky .

Thousands of letters from depositors Mps to alistair Darling have gone unanswered

The silence goes on
bellyup

Bayville, Barbados

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#6
Aug 9, 2009
 
seen on www.ksfiomdepositors.org
[quote[
I don't really believe the current explanations offered for what happened on transferring our money to KSFUK.
We are asked to believe EITHER (a) FSC IOM was incredibly stupid and negligent OR (b) FSA lied to FSC and tricked them into making the deposit.
Remember - UK Govt have insisted throughout that all this Icesave/Kaupthing stuff was necessary to stop the UK banking world collapsing.
Isn't the most likely explanation that the IOM FSC wanted to do the sensible thing and require KSFIOM to spread their deposits (ie outside of the Kaupthing group) in the months preceding the collapse .. but that if they had done so this would have sprung the collapse of KSFUK (with the rest of the group) before UK HMG were ready to do their sting?
And that the IOM FSC were bullied by HMG at a political level to leave the money in the Kaupthing Group until the sting - on pain of serious constitutional changes if they didn't?
The reason why the other explanations don't wash is (i) John Aspen is a sophisticated and highly intelligent man; (ii) the bank and the FSC had top class legal advice in all dealings. There is no way on earth they would have made a cock-up of this nature, or left themselves open to the deceit suggested.
It is not believable that what happened was pure negligence since the dangers would have been so clear there is no chance they would be missed, or accepted unless there were other factors.
Remember - Darling has told the courts his "Iceland-move" was vital to save Britain from a total collapse. Was he going to let the IOM FSC spoil it by jumping the gun? Was he heck.
A political deal was done with our savings - the IOM must have been told that if the FSC did its duty to us (ie put our money elsewhere than Kaupthing group) thereby collapsing Kaupthing and the rest of the British banking house of cards before HMG's trap was ready, Gordon Brown would come down on IOM like a ton of bricks.
Check out the IOM Committe of Enquiry on this. Two of the 3 clearly left school at 16. Are they men for the job? A whitewash yes.
Gordon Brown has sold generations of UK citizens down the river into mortgage slavery in deliberately engineering the cruel and unjust property bubble that made average houses cost 10 times an ordinary joe's salary (unlike say 3 or four times as in the past). He has built the whole economy on that. He has brought down the whole economy on the back of it. All for what - to show he is right. Would you put it past him to bully the IOM to stop them raining on his parade?
I wouldn't and for this reason I think the above is what happened.[/quote]
bellyup

Bridgetown, Barbados

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#7
Sep 7, 2009
 
After 44 weeks 330 days some depositors have got 50k back fromt he DCS

All other governments took about 3 weeks.

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