If the return, from London, of the money is not forthcoming in the next week or so, the only other real option is for the IOM Government to swallow its pride and go and borrow the money, from the UK Government if necessary, to fund a swift and 100% return of deposits.

The Kaupthing Singer & Friedlander (IOM) Depositors Action Group has written to UK Justice Minister, Jack Straw - whose department has ‘responsibility’ for the Crown Dependencies - to see if he will help broker a deal, between the Governments of the UK and the IOM, which will see the repatriation of the KSF (IOM) funds locked in the sister bank in London.

It is claimed that as at least two other major depositors have recovered significant sums of money, then KSF (IOM) should also be allowed to have its money back; and if this was achieved then KSF (IOM) would easily be able to meet its liabilities to all creditors.

However, as currently there seems to be no apparent appetite being displayed, particularly on the part of the IOM authorities, to arrange a meeting to discuss terms, DAG are hoping the UK may extend an olive branch in order to kick start the dialogue.

The trouble is time is fast running out for a deal to be struck, with the deadline of 9^th April, for the next court hearing, almost upon us.

Meanwhile, the long awaited details of the proposed Scheme of Arrangement have yet to be made public; albeit it is believed that negotiations are continuing behind the scenes with the banks, which are needed to help fund it, and the insurance companies who will need to back it. At the moment it seems uncertain whether the support is there.

Certainly DAG members, who have large amounts frozen in KSF (IOM), have sussed out a deal with the UK is the only way in which they are likely to get their money back in a reasonable time frame, if at all.

They realize the SoA is effectively just a short term Government loan to bank roll a pay out, up to the level of the much maligned Depositors (not a) Compensation Scheme, before recouping the money on an equal basis with the remaining creditors.

Questions are obviously been asked why the insurance companies are being so meek over their approach to the whole matter; and it has been suggested by DAG that Donald Gelling’s dual role as Chairman of the Insurance and Pensions Authority, and Director of KSF (IOM) raises some serious question marks regarding conflicts of interest.

It has also been pointed out that the Life Companies have tried to shift responsibility for investment decisions on to the individual bond holders and their IFA’s; yet they were heavily promoting KSF (IOM) in their literature as having an ‘AAA’ rating and a parental guarantee.

A press release issued recently by Olly Scott, on behalf of DAG, states: Since the money was held by KSFIOM in the life company's name the Action Group finds it difficult to understand why customers and their IFAs are solely responsible for placing the funds. “Since KSF blew up all relevant life company literature promoting bonds has been revised,” said Scott “suggesting that the companies accept the way in which the matter was promoted could have been misleading to customers.”

The release goes on to say: What depositors find particularly galling is that whilst the life companies are not willing to take responsibility for the placing of funds, they seem willing to negotiate a Scheme of Arrangement offering less than full return of deposits without reference to the wishes of their bondholders.

The release ends by calling on the Life Companies to wake up, face up to their fiduciary duty, and put their support behind the call for the IOM Government to make arrangements that guarantee a 100% return of bond holders’, and other depositors’, money.

In a separate development, lawyers, acting for DAG, have written to all the Directors of KSF (IOM) putting them on notice they will be held personally responsible for any losses their clients may suffer as a result of alleged breaches of good banking practices.

The letter also asks them to explain why they deposited such a sizeable part of the bank’s funds with one institution; which left KSF (IOM) so exposed to any liquidity and solvency problems of the receiving institution.

This approach by DAG, towards the management of the bank, contrasts quite markedly with that of local advocate Jonathon Smalley, who informed Manx Radio that no-one, “who has spoken so far”, appeared to be suggesting any ‘failure’ within the company; and effectively pointed the finger in the direction of the Financial Supervision Commission.

The only problem is, knowing who was at fault, for the seemingly avoidable error, isn’t going to result in the immediate return of depositors’ money. Clearly apportionment of the blame will come later, and rightfully so, but the priority now is to ensure the many hundreds, if not thousands, of desperate people get their money back, and as soon as possible.

If the return, from London, of the money is not forthcoming in the next week or so, the only other real option is for the IOM Government to swallow its pride and go and borrow the money, from the UK Government if necessary, to fund a swift and 100% return of deposits.

The IOM may then find it has many thousands of new friends and ambassadors rather than thousands of disenchanted adversaries committed to bringing the Island’s financial services down.