Monday, November 30, 2009

Over 8,800,000 people have Googled DON'T BANK ON THE ISLE OF MAN

The Isle of Man considers investment relatively more important than deposits as they are the butter on the bread of the island's economy.

Funds under management on the Isle of Man have fallen from a high of £57.7billion in June 2008 to £34.4 billion end September 2009. That's a massive £23.3billion, a decline of 40.4%. Yet to date the Financial Services Commission choses to make no comment on this decline as to do so would draw critical attention to it.

In the face of the huge holes that are appearing in its financial resources - including a 24% loss of budget revenue as a consequence of HM Treasury's review of the VAT subsidy enjoyed by the IoM - the island's much vaunted AAA Credit Rating is now on notice for being downgraded. The loss of this 9 year old 'sacred cow' will have a major impact on the way the IoM as an offshore financial centre is viewed throughout the world.

Altogether the Isle of Man's economy is now in a precarious position, hence the government is spending £300,000 of taxpayers' money employing PR agencies to promote the Isle of Man as an attractive & desirable place where there is 'freedom to flourish'.

After the financial tsunami of 2008 prospective depositors & investors are now far more on their guard about trusting glossy sales pitches. People are now ultra cautious about where & with whom they put their money. They are doing their own 'due dilligence' looking more closely at the small print and the reality behind the efforts of banks and offshore financial centres to promote a positive image about themselves.

Dispossessed Kaupthing bank depositors are now highlighting the reasons why expats & others should not risk banking on the Isle of Man. This has been dismissed by the IoM as being of no consequence, but the reality is 3,170,000 people have specifically Googled DON'T BANK ON THE ISLE OF MAN and 4,880,000 have Googled DONT BANK ON THE ISLE OF MAN, with an additional 800,000 having Googled DONT BANK ON THE IOM. These are figures that are increasing as the message is being relayed via Twitter, Facebook, blogs and the DON'T BANK ON THE ISLE OF MAN website

The wholly justified campaign by & on behalf of dispossessed depositors is not going to go away until the government accepts that there is a real need for it to seek a political solution to restore all lost deposits 100% in order to promote the best interests of the IoM as a safe & trustworthy place in which to deposit & invest.

Monday, November 23, 2009

IoM bank deposits DOWN for 3rd.Quarter

The latest figures published by the IoM Financial Supervision Commission show a further decline of £390,000,000 in bank deposits over the previous Quarter. This is a total decline of £3.38billion since April 2009. In the context of the IoM's other troubles it is not surprising that the FSC Board delayed publishing these depressing figures.

No doubt the government will make light of the statistics, attributing them to anything other than the Kaupthing Depositors' Action Group campaign DON'T BANK ON THE ISLE OF MAN. Well they would wouldn't they?

Dispossessed depositors feel that they have a moral obligation to warn expats and others throughout the world of the risks involved in depositing on the Isle of Man. To this end a new website has been launched which sets out out some of the reasons why putting your life savings in the trust of the Isle of Man could seriously damage your wealth.

Sunday, November 15, 2009

Friday 13th - not the luckiest of days for the Kaupthing directors ?

It was Friday 13th when the Tynwald Select Committee - inquiring into the collapse of the Kaupthing IoM bank - questioned the bank's directors.
In front of them was Aidan Doherty, Managing Director, Donald Gelling CBE, who was twice Chief Minister of the IoM government, John Cashen ex Chief Finance Officer at the IoM Treasury, and Andrew Davies, financial director.

10,000 expats & others throughout the world thought people of such high standing who were heading up the bank could be entrusted with their life savings. These directors had used their status to promote the integrity of KSFIoM as a bank that would take care of savings entrusted to its care.

Alas! once the bank had gone bust the best they could do was to say, 13 months after the event, that they had done nothing wrong and that the blame for the collapse of the bank was that of the UK Financial Services Authority that they claimed was sheltering behind a "cloud of secrecy".

HOGWASH! This is the sort of superficial nonsense that brings contempt for bank managers from the public & generates huge distrust in the banking system. It is this very act of directors claiming that they were right to put £557million of the bank' liquid assets into Kaupthing UK that is helping to sink further the trustworthiness of the Isle of Man as a safe place to deposit one’s life savings.

Aidan Doherty said in the bank’s glossy blurb back in 2007 “No one knows what the future will bring but we can stand by you when it comes.” He didn't. Not only did he not do so, but he never did the honourable thing at the time or since by offering an apology for the decision to put £557million of depositors' money into a failing sister bank that promptly went into receivership.

Had he & his colleagues been told by their lawyers to keep their mouths firmly shut? Had they been instructed to cover their rears by finding words of explanation that would put the entire blame elsewhere? Was this the amoral ploy of old that even when you know you are to blame always plead innocent & let the innocent party have the task of proving otherwise?

John Aspden, Chief Executive of the FSC, has already been weighed & found wanting in the eyes of the dispossessed depositors. Now the directors join him in the gallery of those who have sought to save their own skins in the pathetically thin defence of their actions which in the view of depositors was a failure to exercise due dilligence with their hard-earned savings.

What is beyond dispute is the innocent people in the Kaupthing fiasco are the disposssessed depositors. The evidence of the Depositors' Action Group submitted to the Select Committee clearly shows up the true facts behind the actions & decisions of the FSC & the bank's directors. It may be downloaded from the DAG Company's website HERE

Depositors are trusting this Tynwald Select Committee to demonstrate the highest standard of objective scrutiny of the facts in order that truth & justice will prevail. The credibility & integrity of this British Crown dependency will stand or fall on the outcome of this inquiry into the biggest banking failure in the history of this offshore financial centre.

Sunday, November 8, 2009

Depositing savings on the Isle of Man is too risky

In a news article in the online 'be your own financial adviser'
Gordon Brown, UK PM said: "..we need to make sure that customers can be confident when they open a bank account that they will be treated fairly; that charges and fees are clear, easy to understand and reasonable; and that their savings are safe."

That is something with which John Aspden, Chief of the IoM Financial Supervision Commission, does not concur. He states that deposits, like investments, on the island carry risk and this has to be recognised by people when depositing their life savings with a bank on the IoM.

Despite this people from around the world still take that risk believing that the reward of a higher interest rate justifies a belief in what the banks tell them concerning the security of their money. That is a dangerous way to make a judgement on whether your money is safe.

Banks only tell prospective depositors what they want them to know; they do not answer the questions depositors ask in order that they may make an informed judgement before parting with their money.

Until the Isle of Man is able to endorse and adopt the principles stated by the British Prime Minister the island can not be considered a safe place to put your money. The message is clear; DONT BANK ON THE ISLE OF MAN as it could seriously damage your wealth.

Thursday, November 5, 2009

DON'T BANK ON THE ISLE OF MAN - now riskier than ever.

The website Shelter Offshore says here : "The Isle of Man as a jurisdiction has taken a battering in recent months because of the collapse of the offshore arm of the Icelandic bank, Kaupthing Singer & Friedlander on the island. The investor protection scheme in place in the Isle of Man has been criticised for not offering enough protection to those who choose to place their money with institutions within the jurisdiction for example.What’s more, the Isle of Man financial authorities have been called to account by many as they feel that they were not tough enough in terms of the regulations they had in place to prevent financial institutions from collapse. So, are Isle of Man savings accounts worth taking a risk on..?"

The article goes on to say: "So, is the Isle of Man a poor jurisdiction that has sold out those who have lost out from a single bank’s collapse? Or is it just the unlucky jurisdiction that had to deal with a collapsed bank? The truth is certainly in there somewhere – but it depends on who you speak to. We fully, wholeheartedly support the KSFIOM Depositors’ Action Group – who wouldn’t. These are people whose financial losses have devastated their lives in many instances – one cannot ignore these people. Yet at the same time, we support the Isle of Man as a jurisdiction because they have done and are continuing to do what they can to protect those who place money within financial institutions on the island."

What a dichotomy! It is explained by Shelter Offshore having a vested financial interest in promoting investment & deposits on the Isle of Man & other offshore financial centres. Therefore it has a clear bias towards defending the offshore centres themselves, whilst acknowledging that there are risks involved in putting one's trust in them. So it conveniently passes the buck back to the depositor (or investor) by concluding: "When it comes to your money however, you have to make the judgement call for yourself. You need to look at any recommendations you’re given and see whether you agree and feel that yes, the jurisdiction favoured and the financial institution chosen for the enhancement of your wealth is appropriate for not only your risk profile but for your future financial security."

Depositors in Kaupthing have been criticised as fools by Manx people for not fully assessing the risks they were taking in depositing on the Isle of Man. Some have gone so far as to say that they deserved to lose their life savings for not being more circumspect.

The message dispossessed depositors are saying loud & clear to expats and others throughout the world is 'DON'T BANK ON THE ISLE OF MAN as you are at serious risk of losing your wealth.' There's over 30 videos on making that message clear to all. view here

Tuesday, November 3, 2009

Foot treads around the IoM wearing slippers

The IoMToday online journal [report here] was upbeat in reporting on Tony Brown's fulsome praise of the Foot Review. The Chief Minister will have known in advance that Sir.Michael Foot was not going to kick any goose that lays golden eggs for the benefit of both the IoM & UK economy.

Right from the start of the report there was recognition that offshore financial centres are intended to offer bait to suck in money from around the world which gets upstreamed promptly to the City & elsewhere to make lots of money for banks, corporations, & ultra-rich people. This financial industry is the heartbeat of the IoM's economy & the review had to tailor its comments to fit around that fact.

Of course Tony Brown was utterly predictable in pronouncing fulsome praise of the review. He's not going to focus on any of the critical elements of the report, even though they were penned in the soft language of diplomatic Whitehall scribes. Contrary to what was reported by the IoMToday journal the Review was in fact critical of the way the depositors' compensation scheme operated (see pages 50, 51 & 52), and he said that there was room for improvement in handling criminal activity.

The reality is that Foot could afford to be 'nice' to the Crown dependencies because he knows others in the world's financial hierarchy are ready in the wings to press hard for opacity in the way some offshore agencies operate.

The IoM trumpets that it is going to introduce automatic exchange of information in 2011, but why wait until then to do so? Because instant transparency would be sure to expose very many transgressors! Despite protests of being squeeky clean the powers that be in the IoM know that though they have shed the pejorative label 'tax haven' they have still to get rid of the equally damaging one of 'secrecy jurisdiction'.

The Foot Review addressed the subject in very general terms. Others are looking at it in detail and the government will have to use its new 'mindset' to work out how the island is to rid itself of that label as well. Very challenging times lay ahead for the IoM.

Sunday, November 1, 2009

Foot said nothing that we didn't know already

Sir Michael Foot said nothing that we didn't know already. In acknowledging the role played by the Crown dependencies in attracting money from across the world & funneling it into the City he could only focus on making recommendations that would make that activity conform with total transparency to mandatory international standards.

However, reading between the lines Foot made observations that would make a wise & prudent person think twice before being lured by higher interest rates into depositing offshore. Depositing on the Isle of Man can not be considered safe & secure until there is a new & credible compensation scheme in place that delivers quickly what it promises should the deposit taker be in trouble.

Until then the message is clear, don't bank on the Isle of Man to look after your life savings in a manner that gives you total peace of mind through an unambiguous assurance that your money is in safe hands. As said in its article 'Taking a closer look' "do not be seduced by offers of higher rates or guaranteed returns without a healthily cynical view of the small print."

Foot Review Report here