Sunday, 1 May 2011

Eating elephants

Anne Elliot in Jane Austen's Persuasion says women, more than men, feel the pain of tragedy for longer. I can only concur, as in my case, this appears to be only too  true. Where my husband has put the agony of our financial failure behind him, I am still, on occasion, haunted by the horrors of our demise along with the painful, frightening experiences which went with it. The memory of the vicious verbal attacks I received, together with the shame and discomfort I felt in our disgrace, can still make my stomach churn nearly three years later.

Never before have I ever had to explain to anyone, although substantial funds were owed to them, there was nothing in the pot with which to pay them. I saw this unpalatable disclosure as an act of "reneging" on our part and it was totally alien to me. I have always previously paid my way in full and I was tormented by the impact our downfall might have on other people’s lives. It was a phone call to an insolvency practitioner which helped me order my feelings about our circumstances. He did this by asking one simple question.

"Who took the commercial risk?"

This uncomplicated approached produced a healthy shift in attitude which enabled my almost instant recovery from a paralysis, self loathing and guilt which until this point enveloped me. Amidst the panic and chaos of discovering we were not only penniless but £1,000,000 in the red, I could finally see it certainly wasn't me who had taken a commercial risk and bizarrely enough it wasn't really my husband either. Applying this simple principal to each debt enabled me to start thinking rather than reacting. I immediately calculated, out of all the people we owed, who had and who had not taken a commercial risk. When it came to it, almost all our creditors had, while in full possession of all their faculties, entered a business arrangement with my husband which had not worked out. Unfortunate it may well have been, but nevertheless the decision to extend a line of credit to my husband was taken by business people who knew full well "you cannot win them all".

So if I, a fifty three year old house wife and mother of five, while suffering from shock and a debilitating grief has managed to grasp this basic principal, why are the business savvy high fliers at LLoyds TSB and the Bank of Scotland struggling to get a grip on the details of our situation and the futility of their pursuit?

I have recently discover the answer to this question in is BBC broadcaster and journalist Ian Fraser's report of February 2010. He explains why Halifax Bank of Scotland is the worst bank in the world and relays "it's calamitous seven year history". Not only were their executives "dangerously out of control and probably fraudulent" in their single minded high risk pursuit of short-term profits, but their initiatives held no regard for the long term cost to their share holders nor did they consider how their lending decisions would harm their customers. The executive directive appears to have been to achieve short-term profits regardless of the consequences. With this course set, Halifax Bank of Scotland's reckless and irresponsible behaviour was ultimately aided and abetted by the decision of the FSA to turn a blind eye to the banks blatant wrong doings. This created a toxic recipe was not only the undoing of many individuals but provides the back drop to my ongoing attempts to communicate my resulting financial distress to HBOS who, instead of showing understanding, have now become out tormentors.
More recently the Bank of Scotland and Lloyds TSB's have both adopted a pious public disposition to what they now choose to view as "other people's indulgences". It has made them impossible to reason with them over a £217,000 shortfall which they refuse to admit their own actions created. Unlike me and the our other creditors (totalling £600,000) all of whom have accepted we are without the means with which to repay them, these too big to fail banking institutions seem unable to comprehend they are merely dealing with a misjudged commercial risk from which they must move on. However I know this holier than though attitude is merely an elephant in the HBOS room which, if I am to enjoy any hope of a debt free future with my family, must be consumed. Thankfully I have it on the very best authority this task is a perfectly feasible one if I am prepared to approach it with one bite at a time.

With the help of some much valued prompting from friends and sympathetic bankers who have already written off our debts, I can see it is most definitely time to invite the media to the table. Here's hoping Ian Fraser, Jeremy Paxman, Jeremy Vine and anyone else who is prepared to listen have a penchant for a banquet of HBOS elephant.

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