Deputy got it wrong, says GFSC chairman
Wednesday 15th October 2008, 2:29PM BST.
PETER HARWOOD, the chairman of the Guernsey Financial Services Commission, made a rare public statement yesterday to rebut criticism from Vale deputy Matt Fallaize.
The States member had claimed that deputies had been told in a meeting with the regulator that all banks trading in Guernsey were secure. But in a letter sent to all States members, Advocate Harwood (pictured) said that was not true.
‘I was present at the meeting and I want to make it clearly understood that at no time during the meeting did any representative of the commission make comments on banks’ security or capitalisation,’ he said. He said the GFSC had been made aware by Landsbanki Guernsey before the meeting that it had begun to experience a significant level of withdrawals from its depositors.
‘This information about the bank was communicated to the chief minister immediately before the meeting with States members and repeated to members of the Policy Council at the meeting held later that afternoon,’ he said.
* Deputy Fallaize refused to back down yesterday.
‘What we know from Mr Harwood’s letter is that concerns were raised about Landsbanki Guernsey before the meeting because the chief minister was briefed,’ he said. ‘I would ask why that information was not made available to all the other deputies?’
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I am guessing that Mr Harwood, having told the Chief Minister of the GFSC’s concerns, considered he had discharged his duty and that he felt it was a political decision to make the news more widely known. I don’t know what Mr H’s responsibilities are in this regard but the CM’s decision, it seems, was not to reveal this information to his colleagues at the meeting.
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Ted, fair point but we don’t know for how long the GFSC had concerns and how long they took to take any action. It is correct that the GFSC Commissioners have a duty of good governance but we haven’t the evidence to show that they acted in line with those principles.
We certainly are aware that the GFSC were involved in the meeting with States Members and effectively misled them by witholding information.
The States Members were led down the road of slow action and setting up a committee to look at a bank funded depositers’ protection scheme. This is different to how they have dealt with the issue elsewhere, particularly the UK and Jersey.
The CM should not have been part of witholding information either and his colleagues need to consider how they should deal with this situation.
Tony Webber
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Rather than clarify the matter it seems that Mr Harwood has stirred up some already muddied waters.
As the purpose of the meeting was apparently to discuss a depositors protection scheme it seems odd that States members were not told, even in confidence, that there was a problem. If they were not told there was a problem it seems even odder that no reference was made to the Policy Council media release of the previous Friday and the message that “(banks were) robustly regulated, properly capitalised and continuing to meet their obligations and liabilities”
Even if Mr Harwood’s recall of the meeting is correct it seems reasonable to assume that the States members present, believed on the fateful Monday afternoon, that Guernsey banks were, as indicted the previous Friday by the Policy Council, still robustly regulated, properly capitalised and continuing to meet their obligations and liabilities.
Is it really believable that the state of banking in Guernsey would not have been mentioned or at least, implied in a meeting to discuss the need for protection of bank deposits with the GFSC?
As Guernsey dos not have executive government it seems odd that the Chief Minister, who Mr Harwood says was told of the problems prior to the meeting, did not share the information with his fellow deputies.
I’m sure depositors in Landsbanki Guernsey would wish to know how a bank on Friday stated as being robustly regulated, properly capitalised and continuing to meet their obligations and liabilities, could have suffered sufficient misfortune to be seen as needing to be put into administration by lunch time on the very next working day.”
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Stephen John
R U forgetting that an all expenses holiday was at liberty here?
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Stephen, Spot on.
Time for a full investigation so the depositers and the people of Guernsey are given the full facts.
Tony
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Paul
Try again. I have no idea what you are on about when you say “R U forgetting that an all expenses holiday was at liberty here?”
I understand the “Are you forgetting” bit but the rest?
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