Banks & Finance – Page 30

Banking sector looks for help

It was only a matter of time before the Irish banking sector was forced to make a move on the growing sub prime crisis.

The headline in this morning’s Irish Independent “Banking chiefs seek ‘dig-out’ from taxpayers” leaves us in no doubt as to who they think should pay to get them out of the mess.

Richie Boucher, the chief executive of Research Financial Services Ireland wants long term funding to the banks to be “provided domestically” by taxpayer’s.

Why domestically? Well, Boucher explains that it wouldn’t be prudent to be ‘overly reliant’ on the European Central Bank for borrowings.

What he really means, I suspect, is that the ECB would impose strict conditions and demand accountability for any rescue package whereas Irish politicians can be pressurised into handing over taxpayer’s money without the need for all that awkward repayment and accountability stuff.

Those fecking efficient Germans

What a novel experience it must have been for Irish police to find themselves raiding a bank as part of an investigation into suspected criminal behaviour by its board members.

No, silly, not an Irish bank. Irish banks are never, ever raided. No, it was a German bank and it was the German authorities who asked the Irish police to raid. Oh those fecking efficient Germans, why can’t they be like the Irish and just ignore suspicions of major white collar crime.

The German investigation is centred around a €17.3 billion hit on a German bank that originated in Dublin’s IFSC financial centre, an entity that the New York Times recently described as the ‘Wild West’ of European finance. Another financial expert referred to the Dublin operation as “A sloppily-run pig sty”.

Meanwhile, in a rare show of activity the so called Irish Financial Regulator issued a statement saying it was ‘aware’ of the raids – Dimly aware, I suspect.

Copy to:
Financial Regulator

DCC/Fyffes scandal – RTE still ignoring the story

Last Tuesday afternoon the High Court appointed an inspector to investigate the issues and circumstances surrounding the DCC/Fyffes scandal.

RTE made a very short report on the development on its Six One News (10th report) the same evening. There was no background information, no interviews with DCC/Fyffes officials, no interviews with state regulatory agencies, no in depth reporting of any kind. The development was not carried on RTEs Nine News and to my knowledge no other programme reported on the development.

In other words, RTE are continuing with their virtual news blackout on this very serious and important story. My question is simple – Why?

Copy to: RTE News

White collar crime in Ireland? – Where?

Crackdown, fraud, hundreds of arrests, greed, fraud charges. These are some of the words used by RTE in a report (6th report) on the action taken by US law enforcement agencies against those involved in the sub-prime scandal.

In the same report we see film of two executives from Bear Stearns bank who were charged with fraud being led away in handcuffs.

It really is fascinating to compare this report with how RTE (1st report) covered the resignation of Jim Flavin when he resigned from DCC recently.

Keep in mind that the Supreme Court found that Flavin fraudulently engaged in insider trading involving sums of over €83 million.

Not once in the report are the words fraud; greed, charges or arrest mentioned. RTE economist George Lee is also interviewed on the scandal and again no mention whatsoever of fraud, greed or crime.

RTE, in common with the rest of official Ireland, simply refuse to accept that white collar fraud exists in Ireland.

Meanwhile, Flavin remains a free man with not the remotest chance that he will ever be charged much less filmed being led away in handcuffs.

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RTE News

'Experts' and law enforcement

Sometimes I despair when I hear so called experts expound on the numerous cases of dodgy dealing and corruption in Ireland. I have no idea how educated these people are or what secret agenda they may hold but I do know that, for the most part, they talk drivel.

Take the issue of law enforcement for instance. When a law is enacted in most healthy and democratic jurisdictions it becomes instantly enforceable. The police/regulatory agencies do not require a lead in of years before they feel confident enough to actually enforce the law. In Ireland, according to these so called experts, things are different.

Case one:

Solicitor Barry Lyons in a discussion about the fallout from the Michael Lynn scandal cited a recent case taken by the ODCE as an example of how things were changing with regard to law enforcement (Sunday Supplement).

“I think this week that a prosecution was brought against the director of a company who borrowed in excess of what he should have from the company. It’s unfortunate that the act was introduced in 2001 but prosecutions are beginning at this stage. But, you know, it’s part of the process for the development of the economy.”

So, seven years later somebody has actually decided to enforce the law.

And what’s this thing about ‘part of a process for the development of the economy’? What has this comment to do with law enforcement? Nothing, it’s just part of the brainless waffle we are constantly subjected to from these so called experts.

Lyons may just as well have said – ‘But, you know, it’s part of the process for the development of efficient toilets on the International Space Station’ or ‘But, you know, it’s part of the process for the development of winter heaters for cows teats’.

Case two:

Economist Muir McDowell in a discussion about the fallout from Flavin/DCC insider dealing case (Marian Finucane Show, Sunday).

“Things are changing, under the Competition Act people can now get jail sentences and suspended sentences have been handed down.”

The problem with this ‘expert’ view is that the Competition Act has nothing to do with the Flavin case. The relevant legislation is the Companies Act, 1990.

Eighteen year old legislation and this is the first case of insider trading in Ireland. This can only mean that Irish businessmen are the most honest in history or the law is not being effectively enforced.

In any case, when McDowell talks about jail sentences, even under the Competition Act, he surely can’t mean jail for white collar criminals.

Allow me to enlighten any chronic optimists out there who may be under the illusion that Flavin may be charged or even end up in jail.

I can say with absolute certainty, he won’t. He will never be charged, he will never answer to a jury of his peers; he will never see the inside of a jail.

The Companies Act, 1990 is nothing more than window dressing, a sham piece of legislation designed to give the impression that Ireland actually takes white collar seriously.

Case three:

Niall Brady, Money Editor Sunday Times discussing the mis-selling of products by financial institutions to the elderly (Primetime).

It was put to Brady that perhaps the financial institutions didn’t have enough fear of the Financial Regulator.

“I think that attitude is changing because we tend to forget the regulator has only had a mandate and the powers to enforce consumer protection for about two years. So in a lot of cases the regulator is still feeling its way, but I think with the powers the regulator has now things are changing.”

The Financial Regulator was set up five years ago and was hailed as the great protector of the consumer, the organisation that was going to kick ‘ass big time. The vermin that had infested the Irish financial sector were going to be exterminated; the bad old days were over. Alas, it was not to be.

Initially, somebody ‘forget’ to give the regulator any enforcement powers at all. This is like designing a car but not bothering with a fuel tank. In any case, the Financial Regulator has been up and running with enforcement powers for at least four years.

So, how long does Mr. Brady think the regulator should be given to ‘feel it’s way’? How many more millions have to be robbed from consumers before the regulator feels it has a grasp of its powers? How long before the vermin infested financial sector is finally purged of its filth?

Consumers are advised not to hold their breath or listen to ‘experts’.

Secrecy law remains unchallenged

Mary O’Dea, Consumer Director at the Financial Regulator’s office was asked about the Bank of Ireland lap top scandal on Drivetime (8th minute) yesterday.

“It’s a matter we are investigating so I can’t go into the specific details with you.”

When she was asked how and what they were investigating O’Dea replied.

“I can’t; unfortunately, I’m prohibited by law from going into the details of the investigation.”

It was at this point that RTE presenter, Mary Wilson, should have challenged this civil servant with basic questions such as;

What law exactly are you basing your refusal to provide this information?

Are you absolutely sure that this law forbids you from informing Irish consumers of even the subject matter of your investigation?

Can you email a copy of this particular law to this programme so that we can have our legal team analyse its contents to confirm for our listeners that your interpretation of absolute secrecy is correct?

Is the Financial Regulator happy with this high level of secrecy surrounding its investigative activities?

Is the Financial Regulator happy with the fact that this law poses a serious disadvantage for consumers?

If the Financial Regulator is not happy with this law has there being any attempt to have it repealed?

Are you prepared to come on air again in the near future to defend your position regarding this secrecy law?

Unfortunately, Mary Wilson asked none of these questions and so, in effect, consumers have been let down by two state agencies.

Copy to:
Drivetime
Financial Regulator

What is RTE afraid of?

To my knowledge only this website and Vincent Browne in his Irish Times column (Sub Req’d) have covered the real story/scandal in the Fyffes/DCC insider dealing case.

All other media outlets are merely reporting the facts with some referring briefly to the options open to Paul Appleby of the ODCE.

And yet this is the biggest and most serious insider dealing fraud in the history of the State. Browne describes it as

“By far the greatest theft in the history of the country.”

Nobody seems to think it odd that the entire State regulatory/law enforcement sector have turned a blind eye to the whole scandal.

RTE, in particular, seems to have made a deliberate decision not to examine the many serious questions surrounding this major fraud.

In a previous post I described RTEs failure to adequately cover this scandal as ‘curious’. I no longer think it’s just curious, I think it’s disturbing. I believe it raises serious questions about the credibility and editorial balance of the RTE News staff.

I believe any reasonable person examining the minimum coverage by RTE of this, the biggest financial fraud in the history of the State; can only come to the same conclusion.

The story broke on Monday 14th April.

RTE internet headlines – No coverage.

RTE (Radio) One News (6th item – It should have been the first item) – The bare facts of the case were reported followed by a short interview with Richard Curran, deputy Editor of the Sunday Business Post. This is exactly the same minimum coverage provided when the case came up for mention in the Supreme Court last November.

Incredibly, there was a complete radio news blackout on the matter after that. This major event wasn’t mentioned again on any radio news report. And this included RTEs flagship news and current affairs programme Drivetime. I find it very disturbing that the national broadcaster killed this story so quickly.

RTE (Television) One News – No mention whatsoever. I again emphasis this major story had only broken a few hours earlier and it was ignored by this programme – Why?

RTE Six One News – The story was given low priority (8th item) and minimum analysis comprising of a broad outline history of the case. The scandal received the same low level of attention on Nine News.

Morning Ireland (15th April) No mention of the case whatsoever. It should also be noted that, to my knowledge, not one of RTEs business news reports mentioned the scandal.

I will be tuning into RTEs The Business next Sunday morning to see if the story is covered and in particular if listeners are provided with an analysis of why State authorities have completely failed to act against the fraudster Jim Flavin.

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All RTE current affairs programmes

Mafia country

Padraic O’Connor, the former director of NCB has stated that he is not and never was a friend of Bertie Ahern’s. In spite of this Ahern is adamant that they were very good friends. In effect, Ahern is calling O’Connor a liar. It’s as if O’Connor said that black is black and Ahern retorted, no; black is white.

This kind of fantasy world speak is common throughout all of Ahern’s evidence to the Tribunal. Only a fool would believe he is telling the truth and only someone from Mars would be in any doubt as to what really happened.

So why is he still the Prime Minister, why isn’t he being questioned by the police, why is it that, as sure as black is black, Ahern will never be brought to account for any of his actions?

Less than a week ago it emerged that the UK Labour Party had received large donations from a businessman using middlemen to pass on the money.

The next day there was a resignation. Three days later an opposition politician asked the police to investigate the matter. To my knowledge this has never happened in Ireland despite years of rampant political and business corruption.

Four days later the UK Electoral Commission also asked the police to investigate. The Irish equivalent, The Standards in Public Office Commission is debarred by law from initiating an investigation until it first receives a formal complaint.

This commission is a joke. The law debarring the commission from acting seems to have had only one function – to assist and protect the corrupt.

The reason Ahern will not be brought to account is because Ireland is a corrupt state. There is no authority in Ireland with the power, will or courage to bring rogue politicians or corrupt businessmen to justice.

This is why corrupt politicians like Haughey and Burke can successfully live out careers of rampant corruption doing untold damage to Ireland and its people.

It’s the reason politicians like Lorcan Allen can go on RTE and arrogantly admit that he doesn’t bother with obeying the law.

He knows with absolute certainty that nobody, no authority in the land can touch him. Allen is merely doing what any ruthless and unprincipled politician will do when he knows that the country he operates in is a corrupt entity. He allows his greed and arrogance full rein despite the massive damage done to society by his actions.

Jim Flavin of DCC possesses the same arrogant confidence that is common to those who know they are untouchable.

Found guilty (2nd item) of insider trading by the highest court in the land, a crime that sees long jail sentences in real democracies, Flavin knows he has nothing to worry about, he knows that there is no authority in the land that will take any serious action against him, he knows that the pathetic attempts by the ODCE to make him accountable are just that – pathetic.

Financial institutions and in particular the banks have robbed millions from consumers over the years. Not a single bank official has ever been questioned by the police. The banks too are supremely confident that they operate in a country where the system is specifically geared to protect their criminal behaviour.

The so called Irish Financial Regulator is a joke, it monotonously issues just one piece of advice to consumers –shop around. You want advice on buying a car, a house, a condom, a politician, the regulator has the answer – shop around.

In the meantime it enthusiastically enforces a secrecy law that forbids any consumer from knowing which financial institution is engaged in criminal activity and which, if any, is honest.

Nobody has even hinted that Ahern should resign or be fired for his behaviour. The only discussion that comes near to any possible consequences is that he might have damaged his chances of landing a job in Europe or that the controversy might damage his legacy – that’s it.

A Prime Minister who, when he was Minister for Finance, accepted very large amounts of cash from ‘friends and businessmen’ who insults the intelligence of all thinking Irish citizens with his ‘Alice in Wonderland’ explanations is not expected to resign, not expected to be accountable, not even expected to come up with a decent lie.

Let’s be absolutely clear about the situation. Ireland is not a normal country, it is not like any other Western democracy. It is a country run more along the lines of a mafia operation than a modern democratic state. It is a country where the powerful can do as they wish without the slightest fear that they will face justice.

David Cameron, leader of the UK Conservative Party speaking about the ongoing scandal said;

“There is a time in the life of every government when it slips over from complacency into arrogance, and from arrogance into even indifference for the law”.

To paraphrase him, I would say: There is a time in the life of many states when they slip over from the democratic process and become a country that operates principally for the benefit of the rich and powerful.

The corrupt Haughey began that process in the 1980s and his faithful and admiring protégé Bertie Ahern, has been successfully following his masters low standards ever since.

Copy to:

Fianna Fail
Standards in Public Office Commission
ODCE
Financial Regulator
Revenue
ISE
Dept. of Finance

Grotesque distortion of the English language

Michael Buckley is a former chief executive of Allied Irish Banks, an organisation responsible for the theft of millions from both customers and the State.

He is now the senior independent director on DCCs board, a board that is fully supportive of its executive chairman, Jim Flavin, who was found by the Supreme Court to have engaged in insider trading.

Buckley says that that the board’s stance is

“grounded in justice, fairness, honesty and decency”.

Words like justice, fairness, honesty and decency coming out of Buckley’s mouth in respect of these events can only be described as a grotesque distortion of the English language.

Later, he further justifies the board’s stance by saying:

“Anyone concerned for the reputation of the Irish market as a result of the affair would reach the same conclusion.”

This is a less than subtle message to regulatory agencies that if they make a big fuss about this it could make Ireland look bad internationally.

A similar strategy was employed during the DIRT scandal. Politicians, government departments like Revenue, Dept. of Finance and other so called regulatory agencies were warned that if they did anything to stop the mass criminality involved there would be a flight of capital out of the country.

This strategy worked until the only real regulatory agency, the media, got wind of the scandal.

Judging from the almost complete lack of action against DCC and Jim Flavin, it looks like the so called Irish regulatory/law enforcement agencies have again folded under pressure from the likes of Buckley.

Law enforcement in Ireland is a joke

The mosquito was focused, hungry and determined to get his fill of blood as he swooped towards the massive rump of the elephant’s rear end. Alas, all his ambitions, hopes and puffed up self importance were instantly snuffed out with one contemptuous flick of the elephant’s tail.

And so it was that Paul Appleby, Director of Corporate Enforcement, was summarily dismissed by the Supreme Court when he tried to obtain a disqualification order against certain personnel at DCC in relation to the recent insider dealing case.

The principal target of ODCE is Jim Flavin of DCC who was found guilty of insider trading by the Supreme Court last July (Sub. Re’q). One of the judges, Mr. Justice Fennelly, said;

“To trade on the use of inside information is recognised for what it is. It is a fraud on the market.”

Actually the judge is wrong. If insider trading in Ireland was recognised for the fraud it is there would have been immediate action from at least some of the many so called regulatory bodies involved.

Nobody has moved. All the so called enforcement and regulatory agencies of the state, the police, the Director of Public Prosecutions, Revenue, the Stock Exchange, The Association of Investment Mangers who allegedly oversee corporate governance in listed companies – all acting like frightened rabbits caught in the glare of a bright light.

The ODCE, in what can only be described as a laughable and pointless gesture, arrived unannounced in court to ask the judge to grant a disqualification order. The judge told him to take a hike.

Paul Appleby put a brave face on the humiliating dismissal (RTE News, 6th item).

“In dismissing my application, the issue of a potential disqualification in these proceedings is now open I have therefore achieved my primary objective in taking this application.”

I have no idea if Paul Appley lives his life under a constant state of delusion but if he thinks he is going to succeed in his aim of obtaining a disqualification order against Jim Flavin or any other dodgy character who may have been involved in this fraud, then in this regard at least, he is most certainly living a delusion.

For over three years Mr. Appleby has been trying to obtain a similar order against nine former National Irish Bank ‘characters’ who were in charge at a time when the bank robbed millions directly from customers accounts and indirectly from the State through the operation of major tax evasion scams.

Only one order has been successful and that’s because the man involved is retired, has no involvement in business and decided not to fight the case.

Mr. Appleby has also, to date, spectacularly failed (Sub. re’q) in his attempts to have the Bailey brothers disqualified. These fraudsters recently came to an ‘arrangement’ with Revenue for over €22 million.

The bottom line is that law enforcement in Ireland is a joke, a farce, especially when it comes to white collar crime.

I recently cited the case of P. Nacchio convicted in the US of insider trading. He was sentenced to six years in prison, fined $19 million and ordered to forfeit $52 he earned in illegal stock.

Now that’s law enforcement.