Councillor 'Gagged' Over Icelandic Bank Fiasco

Julian Bell claims there was prior warning of the risk attached to deposits

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An opposition councillor is claiming that he is being gagged to prevent him making more embarrassing disclosures about Ealing Council's investments in Iceland.

Julian Bell says that a report by the Council’s independent financial advisors had said as far back as February 2007 that investments in Icelandic bank Glitnir would be at risk.

“I will not be silent about this issue – I think the public have a right to know when the Conservatives knew about the risks and why they gambled such large sums of taxpayers money.  The Conservative finance chief David Scott called it ‘a mere £2 million’ but for normal folk £2 million is a shed load of money,” said Cllr Bell.

Cllr Bell attempted to quiz Tory finance chief David Scott about the report during a recent Council meeting. He was barracked by Conservative members and then banned from asking further questions by the Chair of the meeting Conservative Leader, Jason Stacey.


“What I would have said if I had been allowed to speak’, said Cllr. Bell, “is that many local taxpayers would simply like to know the truth: did the Conservative Administration read the report from the Council’s advisors or not; and if they did, why did they not follow its recommendations and save us all £2 million?”

The report suggests that at one point the Council had over £12 million invested in Icelandic banks but most of this money was withdrawn over the course of the year. The money with Glitnir bank was deposited on 15th January 2008 for a fixed term of 365 days at a rate of 5.45%. At that point the rating of the bank with international credit agencies was within the Council's criteria. The report suggests that the Council was unable to withdraw this money because of contractual obligations.

When the loss of £2 million was first discovered the Council put out a press release saying that they did not have any money at risk in Icelandic banks. 


December 14, 2008