Isle of Man News - POSTED Wed 18-06-2014

Treasury Minister defends Sefton bailout

by Joanne Clague

Treasury Minister defends Sefton bailout - picture

The Manx Parliament has voted to bring the Sefton debacle back before Tynwald in July.

The Council of Ministers will have to report to the sitting on the illegal bailout of the Sefton Group. An independent legal investigation has found that tax payers' money was loaned 'ultra vires' - in other words, unlawfully. A £450,000 loan was made in 2012 and a £1.2million loan in 2013.

In Tynwald yesterday, Treasury Minister Eddie Teare was called on to 'defend the indefensible'. He said the loan had helped contain 'the domino effect'.

Mr Teare said: 'How is it indefensible that those people who were owed a substantial sum or sums of money at the time that this transaction was structured have now got a substantial part of their money back? The creditors are down by a substantial amount, in the region of £2million. If the company had gone into liquidation or receivership at that time, a large part of those creditors who were unsecured would not have received any money. so I think that really has helped those and also it has helped to contain the domino effect.'

Economic Development Minister John Shimmin said he took full responsibility and apologised unreservedly to the people of the Isle of Man. But his offer to resign was rejected by Chief Minister Allan Bell.

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