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Miscellaneous Entries Last Updated: May 19, 2012 - 9:19:12 PM

Sir Keith Mills' Variant on the Coutts Sucks Theme
By Craig W Walsh
Dec 22, 2008 - 10:18:12 AM

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I confess to taking vicarious pleasure in reading about troubles at Coutts & Co.  So I have been doing handstands (metaphorically) while reading the recent press coverage about Sir Keith Mills and his problems with Coutts.  Sir Keith is described by The Times as "the tycoon behind Nectar loyalty cards [and] a major cheerleader in London's successful bid for the 2012 Olympics."

He's even taken a page from my book and has started a website of his own --- one that would not be making the folks in The Strand very happy.  Sir Keith's website has the much more businesslike title of The Coutts AIG Action Group, and you can visit it by clicking here.

Sir Keith has published an open letter to Coutts customers:

19th December 2008

Dear fellow Coutts customer,

If you are a Coutts customer and, like me, have been caught up in the problems with AIG Life Premier Bonds, I would like to draw your attention to a new website, the address of which is below.

I have set this website up to bring together Coutts customers in a combined action against Coutts & Co.

This is the reason why.

Coutts recommended to me, and I assume many other customers, that I place my money in AIG Life Premier Bonds as a way of protecting my capital. They also said it would be a safe alternative to bank deposits and earn a slightly better interest rate.

Coutts said my money would be safe as AIG was the largest insurance company in the world, AA rated, and that the bonds provided instant access to my money, just like a deposit account.

Later, given the negative press reports about the future of AIG, I queried with Coutts, in writing, the safety of keeping my money with AIG, as I assume others did, but they replied that they did not have concerns about these bonds, so I retained them.

Then, this September, payouts from the bonds were frozen.

Bondholders now have been forced to accept two choices.

Firstly, if we try to withdraw our cash now, we face the prospect of losing large sums of money. Or, secondly, we have our money tied up with AIG for three and a half years, with no certainty that our money will ever be returned, and little prospect of earning any additional interest.

This is why I have set up The Coutts AIG Action Group. To look at how all Coutts customers who have similar grievances against Coutts - regarding holdings of AIG Life Premier Bonds - may be able to hold Coutts to account and obtain fair compensation from them.

I urge you to visit the website - your information will be kept confidential.

Yours sincerely,

Sir Keith Mills

The Times says Sir Keith's "claim raises the politically charged prospect of some of the wealthiest people in the country applying for compensation from an organisation owned by Royal Bank of Scotland and therefore underwritten by taxpayers.

"Coutts last night emphatically denied that it had mis-sold the bonds, AIG Life Premier Bonds, and said that it had made plain to Sir Keith and other customers that the bonds, though low-risk, were not risk-free.

"Coutts, according to Sir Keith, recommended that he buy the bonds as a safe alternative to bank deposits and allegedly told him that it had no concerns, even after AIG started to receive negative publicity.

"Bondholders’ money was frozen in September as investors rushed to redeem their money in the wake of AIG’s well-publicised problems in America. Those attempting to take out their money now face losses of about 13½p in the pound.

"AIG, once the world’s biggest insurer, was sunk by huge losses on credit insurance and in September was bailed out by the American Government with an $85 billion credit facility. It is now 80 per cent state-owned."

Sir Keith's e-mail address is as follows:

© Copyright 1998-2008 by Craig W Walsh

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