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Savers who had £840m deposited with the offshore arm of a failed Icelandic bank today called on the government to help them get their money back.
Around 10,000 people had money deposited with Kaupthing Singer & Friedlander Isle of Man (KSFIOM), a subsidiary of Iceland's biggest bank Kaupthing.
KSFIOM had its banking licence suspended and was placed in provisional liquidation on October 9 after Kaupthing was nationalised by the Icelandic government. There is a further court hearing tomorrow to decide if it will go into full liquidation.
The UK government's pledge to savers that they would not lose money as a result of the Icelandic banking crisis did not extend to customers with cash in their Isle of Man offshoots.
While customers of Icesave have been told they will get back all of their deposits, those with KSFIOM stand to lose anything above the £50,000 covered by the Isle of Man's depositor protection scheme.
Although the word offshore conjures up images of wealthy savers, many of those who held money in the bank are not well-off, as Guardian Money reported at the weekend.
An action group for savers said the only reason many of its members had offshore accounts is that they were unable to open onshore ones, for example if they were living abroad and did not have a permanent UK address.
Only 3% of the KSFIOM Action Group's 1,400 members said they had more than £1m deposited with the bank, while 29% had between £50,000 and £99,999 saved and 19% had between £100,000 and £249,999.
The group is hoping to use a special session of the Treasury Select Committee to grill the chancellor, Alistair Darling, about the assets and to urge him to return them to the Isle of Man as soon as possible, as well as asking him to help the offshore savers.
The committee recently announced it would be holding an inquiry into the causes of the current banking crisis and has asked members of the public to submit questions to be put before the chancellor.
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