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Have Your Say: Icelandic accounts

Icesave website
Have you been caught up in the collapse of the Icelandic banks?

The 200,000 people hoping for compensation for money in their Icesave accounts could be facing a lengthy wait.

The Financial Services Compensation Scheme, which is responsible for sorting out the payments, says the government has agreed in principle with Iceland what it calls "an accelerated approach to paying compensation."

But one of the problems is that Landsbanki in Iceland is not even in administration yet

Now under EU law the scheme must pay out within three months unless there are highly exceptional circumstances.

Should the UK government step in to compensate all savers caught up in the collapse of Icelandic banks?

Were people taking unnecessary risks putting money in those banks - and therefore should not be compensated?

Has the episode made you wary of putting your money in foreign institutions?

We asked for your comments, a selection of which are below. The debate is now closed.


I think we all acted in good faith in putting our money into the banks in Iceland. How on earth were we to know this crisis was looming? I have money in a fixed term account that is due to mature next month. I tried to get it out last April when there was a scare but they wouldn't let me withdraw it. It this my fault? Certainly not. Why are we not getting any information as to when our money will be returned to us? We are all encouraged to save and when we do, look what happens. It is awful to be left in limbo like this.
Pamela, Manchester

I believe compensation payments should be paid without any further delay

John, Harrogate, North Yorkshire

Having thought long and hard about where to put some of my lump sum to get the best return following retirement last year, I, like many others, followed the advice of financial experts in the "Money Matters" columns of the national papers and opened an Icesave account. From my perspective the fact that Icesave had been allowed to operate in the UK by the British government provided a certain guarantee that my money would be safe. However, events earlier this month have scuppered this view and I have now lost all faith in these foreign banking institutions. I believe compensation payments should be paid without any further delay. Premium bonds may be the safest place to put my money in the future - no interest/no risk, but a chance of winning a bob or two.
John, Harrogate, North Yorkshire

Spare a thought for Kaupthing Singer Isle of Man investors who have lost their life savings and are being treated as pariahs by HMG. Their money has been frozen in the UK and will probably be used to pay out UK investors. Financial hit and run robbery.
Kate, London

I therefore hold the British government responsible for full reimbursement of my funds with interest

Roger, Ross on Wye

I have 80,000 in a two year fixed interest account with Icesave. It matures in January, 2010. I invested this money in what was an AAA rated bank at the time. I am one of many who understood this was a safe investment with a bank that was accepted to trade freely in the UK. I therefore hold the British government responsible for full reimbursement of my funds with interest.
Roger, Ross on Wye

The investors in Icelandic Banks, including those offshore, should be fully compensated. There are many expats, overseas volunteers and military staff who have no UK address. Because of anti-money laundering legislation introduced by the government, they are not able to hold a UK Bank account and therefore have to put their money offshore. They are not rich yacht-owners trying to evade tax. Why should people who have cashed in on their UK property and moved abroad lose nearly all their money? The FSA gave a licence to Landsbanki and Kaupthing to provide banking to people in the UK. The credit rating agencies gave top A rating for the banks. This led people to believe they were safe banks to invest in. Suddenly, Messrs Brown and Darling impose anti-terrorism rules and confiscate/freeze assets held by the Icelandic banks and that precipitated the collapse of the Guernsey and Isle of Man Banks.
Mark, Kingston

Kaupthing, Isle of Man was a solvent entity until the heavy handed intervention of the PM and Chancellor

D Bailey, Bahrain

Were people taking unnecessary risks? No. Our account was opened with the Derbyshire building society which was subsequently taken over by Kaupthing. The Derbyshire were very eager to advertise the fact that the 100% parent guarantee given by Derbyshire was to be continued with the new owners. Kaupthing, Isle of Man was a solvent entity until the heavy handed intervention of the PM and Chancellor created a silent run on the bank. Should the government step in to compensate all savers? Undoubtedly - given that they were culpable in creating much of the mess in the first place. Additionally many of the British citizens impacted by the collapse of the Icelandic banks will become burdens on the state if they do not have their deposits returned.
D Bailey, Bahrain

"Were people taking unnecessary risks putting money in those banks - and therefore should not be compensated?" What risks? We're talking about Savings (yes savings not speculative investments) and interest was "fully guaranteed". Choice? Prudent British citizens living/working abroad are unable to open UK accounts (thanks to terrorist legislation). Tax Dodgers? Tax is payable in the UK or country of residence. Greedy? Does Moneybox recommend listeners to search for the lowest interest rates? Do you recommend filling-up at the petrol station with the highest prices in order to avoid the risk of contamination? In any case the interest would have scarcely matched real price inflation. Angry Forgotten Victim of the Banking Crisis.
Anonymous, France

Certainly the government should not punish those who were prudent and made what they believed were safe investments in a bank. It is not a crime to look for a good interest rate. This should apply equally to those British citizens living and working abroad who had off-shore accounts because they could not open a UK bank account: we thought our money was safe with the Derbyshire Isle of Man (later sold to Kaupthing) - what a mistake.
Anna, Oxford

I believe the government should seize all Icelandic assets in the UK and the EU should assist. The Icelandic government guaranteed everyone's saving so they should pay - if necessary we should take control of Iceland's finances until the debts are paid.
Doug, Norfolk

Those that chose the offshore route should not be compensated. They tried to dodge UK tax and so should not benefit from UK taxpayers handouts.
Ron Spencer, Sudbury

The UK government directly caused the collapse of Kaupthing Singer in the Isle of Man. Most of the assets of that company were held within KS UK. The government has put that company into administration and is effectively using the IOM depositors' money to fund guarantees to UK KF savers. British citizens saving in KS IOM stand to lose their life savings through this injustice. UK government should not only guarantee all UK savings but repatriate to IOM funds frozen in KS UK by UK government action.
Steve, Douglas

Well done Gordon and Alistair

Andrew Rusack, Saffron Walden

Gordon Brown's Labour government policy is to encourage a savings culture in the UK and therefore if a bank in the UK or overseas fails, the government should support domestic savers 100%. Well done Gordon and Alistair for acting promptly and decisively on Icesave and Kaupthing.
Andrew Rusack, Saffron Walden

I left my wallet in the pub, will the taxpayer compensate me? The rules were clear, 50,000 were covered not unlimited savings.
P Wilson, Brighton

Shan't be trusting any banks anywhere, foreign or otherwise

Diana, Llangollen

Sadly I have never benefited from a seven figure bankers bonus, so have always taken what I thought were low risk money decisions with my hard earned cash. It has been a very rude awakening to discover that an interest account in a bank has proved to be the most high risk strategy I could have taken, and that the money men at the top who have taken huge risks gambling away my money have come up smelling of very expensive roses, ready to invest my money when the stock market reaches the bottom. Strange world. Shan't be trusting any banks anywhere, foreign or otherwise.
Diana, Llangollen

Contrast the generous treatment of the (mainly rich) customers of Icelandic banks and the (mainly poor Bangladeshi community) customers of First Solution Money Transfer last year. Our government did absolutely nothing to help the latter, who had worked hard to send relatively small amounts back home to their families. Government help is based more on newsworthiness than need.
Chris Grey, Guildford

Most savers are responsible people looking for the best deal. Kaputhing Edge was consistently top of the table with best interest rates. Some of us had no choice but to invest offshore because we are expats and apparently our savings are not welcome in UK banks.
P Storey, Spain

I believed the Banks assurance that they were "covered just like any other UK bank" and are grateful the government has stepped in. I am concerned by the possibility of delays in making a payout - and look forward to seeing a firm timetable for this process.
David, Redcar

I have lost 5K with KS&F IOM. I await the compensation process. Nobody helped Equitable Life. Why was this?
Christa Bell,

Why should other taxpayers bail out these people?

Leslie Hills, Gravesend

Like many others, I was relieved to hear from the chancellor that I am to be compensated from my loss with Icesave. However, as I suspected, there seem to be "complications" in the process created by bureaucrats. As to those who say the taxpayer should not bail out these savers, I remind them that this is only a small sum, compared to the billions put into British banks, in order to prevent the same fate. So why should other taxpayers bail out these people?
Leslie Hills, Gravesend

The UK Government mis-handled the whole affair and was a key factor in causing the crash. The use of anti-terrorist laws was clearly not correct and will put the the people of the UK at the bottom of the list. The biggest UK losers from this will be those with savings in IOM, Jersey & Guernsey - They are being left out in the cold and stand to lose everything.
Martin, Florida

I think that the government should compensate savers. Most savers are just ordinary people thinking that it was safe to put money in Icesave. When you see rates advertised and recommended in UK top buy charts coupled with the FSCS guarantee, it would not occur to anybody that this was remotely risky. If savers are not compensated every saver will rush for the doors and only invest in government backed institutions, which would do irreparable damage to banks and building societies alike.
Paul Holdstock, Ware

I shall definitely be more wary about putting money in both foreign and UK institutions in future
Patricia, Bolton
Having retired in April this year I decided to invest 30,000 of my pension lump sum in an Icesave six month bond and feel I acted responsibly by choosing a bank regulated by the FSA and allowed to operate in the UK by the British government. I was also careful to invest less than the 35,000 guaranteed at the time. I invested the rest of my capital in National Savings income bonds at a much lower rate of interest. The Icesave bond should mature next month but I have no idea how long I shall have to wait for this money. I have had no communications whatsoever, either by post or e-mail from Icesave or the FSA and do not know how to make a claim. I feel that I, and other investors who acted in good faith, should be compensated in full by the British government, and I shall definitely be more wary about putting money in both foreign and UK institutions in future.
Patricia, Bolton

The government should fight for those people but not pay out from British cash. Gordon needs to get it out of Iceland first.
Karen, Wakefield

Yes all British citizens resident in the UK and paying UK tax should be compensated. Yes I would be vary wary of investing in non UK banks in the future.
Stuart Wright, Hull

I'm not assured
Steven, Oxford
I have been waiting for over a week for the money that was in Kaupthing Edge. I requested a CHAPS payment to be transferred on October 10th. ING had this money on October 15th. I was told that I would have it in my First Direct Current account by close of business October 17th but this has not been done. I'm now told it "should be Monday, October 20th" but I'm not assured.
Steven, Oxford

ING are talking rubbish regarding the CHAPS payments from KE accounts that have gone missing. There are millions of pounds missing from one internet group alone. We are collating a database - no-one has yet received a CHAPS payment from ING in so far as we can tell.
Kevin & Ann-Marie, Chester

The comments we publish are not necessarily the views of the BBC but will reflect the balance of views we have received. It is helpful if contributors state if they work for any organisation relevant to an issue discussed. Readers should form their own views on whether messages published represent undeclared interests, or views prompted by a common source.

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External internet links
18 Oct 08 |  Moneybox
In full: Councils facing losses
17 Oct 08 |  UK Politics
Universities' millions in Iceland
16 Oct 08 |  Education
UK helps States over Landsbanki
15 Oct 08 |  Jersey
UK offers hope for KSF depositors
15 Oct 08 |  Isle of Man
UK loan offered to Icelandic bank
13 Oct 08 |  Business

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