Did city council miss warning signs over £42m Icelandic investment?

 “WAR of words has broken out over who is to blame for putting £42m of Nottingham taxpayers’ money at risk when Icelandic banks collapsed.

Nottingham City Council invested in three Icelandic banks last year. It made large deposits in the months before the crisis hit, including investments of £7.5m less than two weeks before the financial institutions went down.

The council says it based its decisions on information provided by a firm of external financial advisers, Butlers, and could not have foreseen the disaster.

But Chris Anthony, Butlers managing director, told MPs the information passed to councils should have rung alarm bells. Appearing before the Communities and Local Government Select Committee, he said: “We pass the information on to our clients with regards to credit ratings.

“We keep them fully informed on that and we believe with all the information they have at their fingertips, as professional investors, they should be able to make that decision themselves…”

Click here!Mr Anthony’s view is at odds with that of Nottingham City Council.

At a meeting of the audit committee, director of resources Carole Mills-Evans said: “Our advisors had never mentioned anything about the Icelandic banks issue. Had they done we would have taken action.”

And today, Coun Graham Chapman, deputy leader of the council, said the council might review its contract with Butlers.

 

“We are still using them as a service to say what to do in the future, but this is not helping our relationship with them – we might have to review our position in the light of this.”

..Following the fiasco in September and October of last year, Nottingham City Council was criticised by financial experts and Rushcliffe MP and former Chancellor, Ken Clarke, for not heeding the warnings contained in falling credit ratings of Icelandic banks”

Follow the link below to read more.

http://www.thisisnottingham.co.uk/homenews/Did-city-council-miss-warning-signs-42m-Icelandic-investment/article-646043-detail/article.html

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