Icelandic evidence has melted away!

EXCLUSIVE by DOUG COLLIE

Scottish Borders Council which invested £172 million in four Icelandic banks by making 94 separate deposits between 2006 and 2008 claims it can now only provide details of four of the transactions and has no information about the specialists who advised it on its Icelandic investment strategy.

Freedom of Information requester Joel Benjamin had asked SBC for specific details of the local authority's dealings with the insolvent Icelandic banking sector ten years after £10 million of Borders taxpayers' cash was trapped in two of the failed financial institutions.

Mr Benjamin's five-point FOI question included a request for a spreadsheet showing details of each investment including the amounts deposited, the interest earned and the terms under which the transactions were made.

Not Just Sheep & Rugby has discovered that a spreadsheet provided by SBC in April 2010 as part of FOI request numbered 3667 disclosed the full extent of the financial gamble with public money.

The 94 "deals" averaging £1.82 million involved business with four separate banks based in the "land of ice and fire" - Landsbanki, Heritable, Glitnir and Singer. Each transaction has its own unique reference number and showed when each cash sum was deposited and withdrawn.

But in responding to Mr Benjamin SBC tells him about an attached spreadsheet which has only four entries. According to the council "the only information available is for the funds held at time of bank crisis".

The four deals mentioned are two with Landsbanki worth £3 million and £2 million and two with Heritable for £4 million and £1 million. This represents the £10 million 'loss' incurred in October 2008 when both banks collapsed. There is no reference number given for these transactions.

It took two years and two separate court actions in Iceland before most of the cash was recovered while the outstanding losses were sold for a fraction of their true value. SBC was forced to seek permission from the Scottish Government to borrow over £1 million to cover the gap in its finances.

So it seems the spreadsheet prepared and released in 2010 has either been 'shredded' or has not been provided to Mr Benjamin.

He went on to ask the council for the name of the institution which advised the authority on its Icelandic investment strategy.

SBC claims: "We do not hold any information in relation to this".

However, immediately after the Icelandic debacle it was confirmed the external treasury advisers to the council had been a firm called Butlers whose staff members had also advised many other public bodies about Icelandic deposits.

A report which went to councillors in 2010 and entitled Treasury Management Strategy - the document is still available online - states at page 11: "The council uses Butlers as its external treasury management consultants. The range of services includes generic investment advice on interest rates, timing and investment instruments".

Finally Mr Benjamin asked for the ledger payment codes which detail the transfer of the funds from the council's accounts to the Iceland banks.

But yet again SBC replies: "We do not hold any information in relation to this". It would appear the payment details covering the £172 million worth of transactions between Newtown St Boswells and Reykjavik no longer exist.