On 18 September Paul Myners, Financial Services Secretary, addressed the Financial Times Global Finance Forum on the topic: Developing a new financial architecture: lessons learned from the crisis
In it he said that the fundamental role of any country’s financial sector is to manage risk. "Risks have become increasingly complex, opaque and inter-linked; and it is now clear that the assessment and management of risk by financial institutions failed....But we also learned that that power of the financial system was not matched by responsibility for its actions, creating an accountability gap that has had to be filled by taxpayers across the globe."
That is what happened when the directors of KSFIoM transferred half the bank's liquid assets to KSFUK which were then lost in administration. The directors failed to exercise due diligence when confronted with the known risks of the Kaupthing hf scenario, and the inherent risks to which its sister banks were exposed on account of it. Today they still refuse to accept any responsibility for their crass decision. They refuse to give account - or offer an apology - to the depositors who lost everything through their action.
In advance of its own Select Committee of Inquiry the IoM government has been quick to pronounce the directors, and the FSC that supported them, innocent of any culpability. Blame is placed at the door of others in order that the directors & the FSC could be excused from being held accountable.
Mayners went on to say: "Corporate leaders in the global financial sector have begun to talk about addressing moral failures and that is to be welcomed... it is time to start hearing how they intend to drive moral reform within their institutions."
Now that is an interesting concept that seems to be beyond the current thinking of the IoM government, the FSC and the finance houses of this offshore financial centre. Any notion that they have a moral responsibility to uphold the trust that depositors placed in a bank on this island does not feature in the values they hold.
It is time that we started to hear how the IoM government intends to drive moral reform within itself & its institutions. Until it does people will not trust it. Until then the message to the people of the world is: DON'T BANK ON THE ISLE OF MAN as it is an offshore centre that has no moral integrity. It has no interest in people, only their money.