Stricken councils advised by Tory treasurer's firm
The local authorities facing the largest losses from the collapse of the Icelandic banks were all advised by the same company. Kent, Norfolk, Dorset and Hertfordshire county councils and Nottingham City Council and the borough of Barnet all paid for the services of Butlers, which is owned by the treasurer of the Tory party, Michael Spencer, who has a fortune of £1bn.
Three of the six also paid Butlers' parent company ICAP to broker some of their investment deals. One of the others failed to say who brokered its investments.
Between them, the six councils have £207m in Kaupthing, Glitnir and Landsbanki banks or their UK subsidiaries. The money is about 20 per cent of the estimated £1bn potentially lost by local authorities.
Last night, ICAP vigorously denied it had advised the councils to invest in Iceland. Instead, it said it had helped councils make strategic investment decisions according to their attitude towards risk and other factors.
Britain is negotiating with Iceland to secure the return of the money owed to public bodies in the UK. The total has now risen to £1.3bn, including money owed to an estimated 130 councils, 12 charities, nine police authorities, eight universities and even the Audit Commission, which has admitted holdings of £10m.
Kent faces a loss of £50m, Nottingham £42m, Norfolk £32m, Dorset and Hertfordshire £28m each, and Barnet £27m. Kent has called in accountants PricewaterhouseCoopers to investigate its investment.
Local authority finance officers placed their reserves with Icelandic banks after consulting credit ratings. Global credit rating agencies began downgrading Icelandic banks in May but it was only this month that they dramatically changed their view of their vulnerability to the global economic meltdown.
- 1 Home Office says Nigerian asylum-seeker can’t be a lesbian as she’s got children
- 2 What happens to your body when you give up sugar?
- 3 Drugs Live cannabis trial: Hash is less harmful than any other drug, expert claims
- 4 Turkish Airlines flight TK 726 crash-lands on Nepal runway amid dense fog
- 5 Apple and Google users being spied on for a decade because of 'Freak' security flaw
The City of the Monkey God: Archaeologists claim to have found city lost for 1,000 years in remote Honduran jungle
Turkish Airlines flight TK 726 crash-lands on Nepal runway amid dense fog
Japanese island overrun with cats after population explodes
London property boom built on dirty money
Becky Watts: Stepbrother and his girlfriend named locally as two arrested on suspicion of murder
Durham Free School: 'Creationism taught at' free school facing closure
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
Ukip would cut billions from Scottish budget to fund English tax cuts
End of the licence fee: BBC to back radical overhaul of how it is funded
Ukraine crisis: Top Chinese diplomat backs Putin and says West should 'abandon zero-sum mentality'
Boris Nemtsov shot dead: Outspoken Putin critic who had expressed fears for his life is killed near the Kremlin
£25000 - £35000 per annum: Recruitment Genius: This firm are focussed on assis...
£7 per hour: Recruitment Genius: A vacancy has arisen for a General Processor ...
£18000 - £22000 per annum: Recruitment Genius: A great opportunity has arisen ...
£14000 - £16000 per annum: Recruitment Genius: Full time and Part time positio...