Ruling over at-risk £9m

Finance chiefs at Wyre Forest District Council were not to blame for £9 million worth of the authority's investments becoming trapped in Icelandic banks, an inquiry has ruled.

An eight-week investigation has concluded officials could not have predicted the global economic crisis that led to the collapse of the country's banks.

The council, like several other UK authorities, had put cash into Iceland's finance system with the promise of high returns.

But following their meltdown, the accounts were frozen, and it is still unclear when, or if, all the money will be returned.

A Treasury Management Panel was set up to scrutinise the decisions which led to the money being invested abroad and to discover if anyone had any knowledge that there were signs of possible problems. Management advisers, heads of financial services and auditors were all interview, and the panel concluded that no blame could be apportioned to any officer at the council.

Councillor Howard Martin, who chaired the panel, said in a report: "The council had taken the advice of Treasury management advisers and acted on their advice. We are aware that the money is now at risk but there was no way to mitigate this.

"A full, deep and searching investigation has been carried out, and we have concluded that the council's officers have a clean bill of health. In essence, no-one was culpable."

He said the panel recommended the council looks at its relationship with its current Treasury management advisers and suggested taking on more than one adviser. "We are waiting to hear from the administrators involved with the foreign banks about the return of the council's money," he added.

Council leader John Campion said: "The council welcomes the findings of the panel, particularly recommendations that members are updated more regularly."