Category: Corporate

Moving on – to planet Duffy

When I awoke on Saturday morning I had no idea that I was about to be transported to another planet. But that’s exactly what happened when I tuned into the Marian Finucane Show and was whisked off to planet Duffy by the soon to retire chief executive of Bank of Scotland Ireland, Mark Duffy.

First a little background before lift off. According to Duffy he first became interested in banking when he was introduced to the lovely house and cars belonging to the daddy of a former girlfriend. He stressed, however, that he is not interested in nor motivated by money.

Duffy started off his banking career with Sean Fitzpatrick a man for whom he still has great respect although he did concede that Seanie had created a bit of a problem.

Throughout the interview Duffy repeatedly informed the nation that there is only one solution to the present crisis – take the bad apples out of the barrel and move on. By bad apples he means, primarily, the bad debt in the system. He didn’t specify who should take responsibility for all this bad debt but we can guess.

Here’s a synopsis of reality on planet Duffy. (My translations are in brackets so that ordinary earthlings can understand the language of planet Duffy).

“It really appalls me as a proud Irishman who has committed his life here to actually see how the outside world views us at present; we have to stop. The banks are us and if we inflict pain on the banks we’re actually inflicting pain on Ireland.”

(Keep quiet, don’t rock the boat, pretend nothing happened, move on).

“Everybody needs a hate figure, the banks are a suitable hate figure; Sean Fitzpatrick is a suitable hate figure; we’ve got to move on.”

(Neither the banks nor Sean Fitzpatrick did anything wrong, they just happen to be a random target selected by the public to vent their anger for some perceived but as yet unknown wrong).

“The bankers have taken a terrible punishment from the media.”

(As above).

“In Ireland we have only a small number of people (capable of running the banks); it takes years to get the skills to actually operate at that level.

If we take them out and shoot them (we wish) or have bank policy decided by chat shows and the media we’re going to lose some critical talent going forward.”

(A year in Mountjoy is more than enough to provide the skills and habits necessary to run Irish banks as they have been over the past several decades).

“I asked my own press office to put together the amount of media, radio and TV comment on it and it is just enormous. We are making ourselves the laughing stock, we need to move on.”

(It says a lot about Duffy that he would actually ask his press office to make such a list. Again, the ‘laughing stock’ comment is the usual denial – ‘let’s all pretend that there was no corruption involved in case the international community finds out the truth about Ireland’).

“We don’t have a toxic debt problem in Ireland, what we have is a property problem.” “The downturn won’t last long, not the five or ten years of the doom and gloom merchants.”

(What?? And this man is paid millions for, as he says above, his very rare ‘skills’).

On his reasons for leaving the bank. (No, really, he’s serious).

“I can do no more in the bank; I want a bit of time out, bit of free time with my family. It’s been a hectic 16 years, I’ve worked very hard, 130 flights a year; it takes its toll…I’m a hands on manager, I get my hands dirty, I’m a people’s person. You’ve got to set standards, honesty and service is what people are going to be looking for going forward.”

(If the word ‘bank’ is taken out of this quote and replaced with ‘church’ or ‘charity’ you could be forgiven for thinking that this man is a priest working for the poorest of the poor).

At this point we returned to earth when Marian said there was a whole stream of very angry listeners calling in but it wasn’t long before we were back on planet Duffy

“We understand that, people are venting anger, we need to fix the problem and move on. I mean bank staff are being spat at and abused verbally and physically. People have a generic across the board anger that they’re venting at present.

I can understand that but we’ve got to move on…I’ve lost money, my family have lost money, we’ve all lost money as a society but we’ve got to move on.”

(Hands up all those who believe that he and his family lost money – thought so. And we can be sure that this man is safely removed from all this public venting of anger).

“There’s a difference between the UK and Ireland. I’m sure they’ve got the same level of scandal but they don’t wash their dirty linen in public. They’re getting on with solving the problems…hurting banks ultimately hurts us all, we’ve got to move on.”

(Again, denial and insulting waffle).

On being asked does he still trust the banks? “I’d put my money in Anglo.” (Yeah, right).

Back on earth a listener called in to the show.

“I have lost my job, my pension, my bank shares and my home is worth 50% less than it was last year. I don’t qualify for dole because of some cash savings that I have, I have to feed my kids and pay my mortgage.

If it was up to me, he, and other bankers, would be going to jail and not into the sunset waving goodbye to us suckers. We want our pound of flesh and we want blood.”

(Clearly, Duffy, not used to hearing about the brutal reality created by his type, hesitated before answering as he struggled to say something different, anything to avoid repeating the waffle he had spouted so far – he failed).

“Well, you know, again, that’s a very, very angry comment and I can understand that. I don’t agree with a lot of what she said but I can understand. People are just not differentiating between bankers and banks (what?). It’s just a generic problem…we’ve got to move on.”

Meanwhile, back on planet Duffy. Marian asked: Did you get a massive handshake?

“You can ask but I won’t tell you, Duffy coyly replied. I was extremely well treated by the bank after 16 years and I leave it very happy, very satisfied and I’m looking forward to my freedom.”

(Ah yes, his freedom, his wealth, his happiness, his satisfaction – the complete opposite of what faces the many victims of the banking sector).

Marian asked him would he be worried about the groceries.

“I’m not financially motivated; I’ve always being lucky with money. I have bills to pay and a salary helps with that.”

Copy to:
Mark Duffy

Confusions and bafflement at the school for Corporate Governance

Niamh Brennan, Professor of Management at UCD is a very confused woman. Here’s what she had to say on RTE recently (1st report, 2nd item) regarding the Anglo Irish fraud.

“I’m terribly disappointed that the company did not have the high standards that I thought it had.”

“The accounting standards are very explicit, transactions should not be entered into for the purpose of disguising the truth. What has happened here is a case of deception on the part of Anglo Irish Bank.”

“It is fraudulent financial reporting, I’ll repeat it again because I feel so strongly about it; that is why I’m so baffled, why the Financial Regulator could possibly say there was nothing illegal about the Fitzpatrick loans, I cannot accept that.”

Professor Brennan is baffled because like so many so called experts she still labours under the illusion that Ireland is a normal democratic country. She still believes that politicians, Government officials and regulatory agencies all work for the good of the country, she still believes that the State is intent on prosecuting the corrupt rather than facilitating them, despite overwhelming evidence to the contrary.

Here’s an article she wrote on 3rd June 2004. (My emphasis with comments in brackets).

Shame of our low standards in high places

I am one of the few people that think Enron is a great thing to have happened. That is because around the time of Enron, I established the Institute of Directors Centre for Corporate Governance at UCD. This is a joint venture with the Institute of Directors. Business has been booming ever since.

Happily (for me, but not for the thousands of investors that have lost millions) corporate scandals continue to fill newspapers. This reminds company directors that being a director nowadays carries very onerous responsibilities and risks. Directors need to get training – to make sure they don’t appear in the national newspapers wearing handcuffs, or worse still join George Redmond in jail.

(As corporate governance is a joke in Ireland any director who actually paid for such a course is a fool).

A fairly predictable consequence of corporate scandals, is a call on politicians to do something to sort out the mess. This usually results in even more regulations and laws. This is what happened as a result of the DIRT scandal.

(And the call in response to the current scandals is for even more regulation, anything bar actual prosecutiions).

We now have a new Accounting and Auditing Act which makes even more demands on directors. However, we now also have a very fine regulatory environment in Ireland. In fact, so good are these new regulations, that (shortly after the Enron scandal) Brian Walsh, chief executive of the Institute of Chartered Accountants, described them as a very fine example of public policy development. He said that Ireland would be a leader in the field in corporate governance.

(Remember, this was written in 2004).

Many commentators are complaining about this legislation – that excessive regulation stunts entrepreneurial activity and takes people away from doing business. But I believe the converse is the case. Strong regulation is good for Irish business. It will attract quality investors from abroad.

Low standards in corporate life turn off quality investors, and attract the kind of investors the country would be better off without. The problem with more regulations is that the good guys kill themselves to continue to observe and apply our laws to the highest possible standards, at a considerable cost to their business, both in time and money.

Meanwhile, the bad guys continued to do as before, and approach any new regulations in their usual tickboxing, ritualistic way. Within their inner sanctums, behind boardroom closed doors, they continue to feed their personal greed by cutting corners, and in some cases by outright corruption.

(And we are still waiting, since the foundation of the State, for the first prosecution).

Ireland continues to suffer from the consequences of very low standards in public and corporate life, as featured in the all-too-many tribunals currently in progress. As a result, we are at the wrong end of worldwide corruption indices. This is not good for business, and won’t help us attract top class investors to Ireland.

(But it did attract a large cabal of chancers to the ‘Wild West’ IFSC centre).

In spite of the whingeing from some quarters, while our new regulations are onerous, they are ones which I believe will stand the test of time and which will even become a source of pride to us.

(No wonder the Professor is baffled).

The problem with corporate governance is us – us human beings – and our tendency (on occasion) towards dysfunctional behaviour. Each one of us has to take personal responsibility for our behaviour, for its affect on public and corporate life, and for the messages we send out about the kind of society in which we want to live. I believe that as a society, we are ambivalent about high standards of behaviour in public and corporate life.

(We are indeed ambivalent but that does not excuse the State facilitating white collar crime).

For example, after revelations of questionable (to put it mildly!) dealings in relation to his taxation and other financial affairs, not only did the voters of Tipperary North in the 1997 general election elect Michael Lowry, they put him at the top of the poll. All those voters made a clear personal statement about their attitude to standards in Ireland.

(Agreed, Irish people are politically ignorant with a complete inability to make the connection between voting for a corrupt politician and the inevitable consequences that will follow).

Thus, while we roar and shout when a new corporate scandal breaks, many of us have questions to answer about our own personal day-to-day behaviour and the way in which it influences standards in Ireland, both corporate and otherwise. No laws or regulations can prevent greedy, self-serving behaviour by company directors.

(Wrong. If a company director sees a colleague going to jail he/she will think twice before engaging in corrupt practices. The witnessing of law enforcement is a strong disencentive to wrong doing. The problem in corrupt Ireland is that, for white collar criminals, there is no law enforcement so, in effect, they can do as they wish – and they do).

Add to this, that greedy, self-serving people seek each other out. The old Irish phrase “Aithnionn ciarog ciarog eile” (one “beetle” or maybe “cockroach” recognises another) captures this aspect of corporate life beautifully.

(Ah yes, Haughey/Ahern come to mind).

So on top of good rules and regulations, there has to be a real meaningful engagement, and a commitment to good practice, from each individual human being around the boardroom table. These additional regulations are scary – especially the requirement on directors to sign a statement saying they have complied with company, taxation and other relevant legal regulations.

But, don’t panic, help is at hand!

For all you down-trodden, over-burdened directors, the Institute of Directors Centre for Corporate Governance at UCD (www.corporategovernance.ie) is there to ease your pain. We offer short half-day courses on governance, in house customised courses for individual company boards, and in September 2004 we are introducing a one-year, part-time Diploma in Corporate Governance.

(I would love to see a student list for these courses. I’ll bet Sean Fitzpatrick isn’t one of them.

Professor Niamh Brennan, is Michael MacCormac Professor of Management, UCD Academic Director Institute of Directors Centre for Corporate Governance at University College Dublin

Copy to:
The baffled Professor

Progressive Democrats and light touch regulation

Writing in the Irish Times on Jan 2006 Séamus Mulconroy Progressive Democrats’ director of policy had the following to say about light touch regulation (My emphasis).

IFSC needs light regulation.

If Ireland abandons softer regulation, we will have one of the most stringent financial sector regulatory environments in the world, writes Séamus Mulconroy.

The IFSC has been one of the outstanding success stories of modern Ireland, a public-private partnership that worked, the brain child of entrepreneur Dermot Desmond, backed by the then taoiseach Charlie Haughey.

It transformed an area of disused docklands into a major international financial services. Half of the world’s top 50 banks have Dublin operations. According to the IDA, up to 16,000 professionals work directly in the international financial services sector, and a similar number are employed in support sectors such as legal and accountancy services.

Nor is employment confined to the IFSC, and many IFSC firms have sizable operations across the Republic, including State Street in Kilkenny, GMAC in Mullingar, MBNA Carrick-on-Shannon, Cigna Galway to name but a few.

While the new buildings along the north shore of the river Liffey are impressive, the sheer scale of the operations managed from the IFSC is even more impressive.

The net asset values of domiciled investment funds amounted to €498 billion, while cross-Border life assurance premiums amount to €5.6 billion. The tax revenue to the Exchequer has been equally impressive – in 2002 alone, IFSC companies paid €700 million in corporation tax.

In the early days the value proposition for the IFSC was simple: low corporation tax, a light touch regulatory regime – as little red tape as possible – and an English speaking workforce located in the EU. It was a value proposition that appealed to the international financial services community as attested to by the rapid growth of the IFSC. Just remember that the IFSC was still only a concept in 1986.

However, we live in a constantly changing world and as so many investment products stipulate, past performance is no guarantee of future performance. The IFSC faces many challenges, new competitors are emerging both from within and outside the EU eager to replicate our achievements and frankly to steal our lunch.

The IFSC must adapt to the challenges of the future. The Future Of The Services Sector In Ireland, a consultants’ report prepared recently for the IDA, highlighted some of the opportunities which exist. Just as in the past, having the right regulatory regime will be crucial if we are to seize these opportunities. Recent high-profile scandals in the reinsurance industry in the US and Australia have focused attention on the regulatory regime under which the IFSC operates.

Both Justin O’Brien, director of corporate governance at Queen’s University, Belfast and Liam O’Reilly, chief executive, the Irish Financial Services Regulatory Authority, have both recently written in this newspaper on the issues involved. I do not propose to examine the specifics of the case quoted, but rather to look at the issue of regulation in more general terms.

At the first hint of any scandal, governments and regulators are always called on to act. The cry goes up immediately that something must be done – whether or not that something makes sense or not is another question.

Despite what media commentators always argue, not every scandal requires a government or a regulatory response. Neither government nor indeed regulators should strive to create a risk-free world or a risk-free business environment.

To quote Tony Blair:

“Instead of the ‘something must be done’ cry that goes up every time there is a problem or a ‘scandal’, we make it clear we will reflect first and regulate only after reflection.”

Business is constantly changing and change carries with it new risks. If we seek to pre-empt every risk through regulation, we will simply add to the cost of doing business and drive businesses to other locations.
The essence of business is that investors take risks to gain returns; business without risk would be like the sea without salt.

Charlie McCreevy encapsulated the challenge for regulators in a recent speech:

“My appeal to you is when regulating, to give due weight to the need to strike the right balance between prudential and investor protection considerations and the need for competitiveness and innovation in financial services. “Don’t try to protect everyone from every possible accident. Concentrate on the big things that really matter, and leave industry with the space to breathe and investors with the freedom to learn from their mistakes.”

He also forcefully made the point that those mis-sellers and wrongdoers who break the rules must be punished severely.

In an increasingly competitive world, I fear that if Ireland and the IFSC abandon their commitment to light-touch regulation, the result may be that we have one of the most stringent regulatory environments in the world and very few companies left to regulate.

Light-touch regulation does not mean a free for all or the condoning of illegal or immoral practices; it does mean as Charlie McCreevy says striking the right balance between protecting the public and the integrity of the market and stifling business with burdensome regulation and unsustainable costs.

As the Progressive Democrats have found to their benefit, advice from Charlie McCreevy is always worth listening to.

Séamus Mulconroy is the Progressive Democrats’ director of policy.

© The Irish Times. 20th Jan 2006

Honest Irish banks

We are constantly told by politicians that Irish banks have no exposure to the sub-prime virus. In other words we are being asked to believe that Irish banks are the only banks in the world that recognised the very well concealed virus and, unlike all other bankers, had the integrity to resist getting involved in such a dodgy enterprise.

Nail on the head

Letter is today’s Irish Times.

Madam,

Minister for Transport Noel Dempsey’s attack on those he claimed had committed “economic treason” was entirely predictable, if a little belated. It is part of the strategy of Government leaders to blame international events and a small clique of speculators and bankers for all our woes.

They are being completely disingenuous in doing so and I do not believe the Irish people will be fooled.
The real architects of this economic debacle were the successive Fianna Fáil/PD governments under the “leadership” of Bertie Ahern. We were particularly unfortunate to have as taoiseach a man so lacking in political vision and integrity at a time of great, though transient, wealth. Successive Ahern administrations failed to manage the economy in a sustainable manner. Their ineptitude was staggering.

They claimed they wanted world-class public services at the same time as they were reducing taxes. They reduced direct taxes to the lowest level in Western Europe, simply to win elections, and now we find we have an unsustainably low level of taxation, which cannot allow us to even maintain the poor level of public services we currently “enjoy”.

They failed to institute a fair tax regime while giving generous tax breaks to speculators, fuelling the construction bubble. They also established less ethical, though technically legal, tax breaks, which have earned this country the dubious distinction of being compared to Lichtenstein. They were a government of “chancers” led by the “Dell Boy” of European leaders.

They established a regulatory regime which was lamentable, as we now know to our cost. They presided over a scandalous waste of taxpayers’ money by adding layers of Government spin-doctors and advisers, often duplicating the work of civil servants. They appointed cronies to state bodies such as Fás, the organisation of jobs for the boys and junkets for the boys.

They established juggernaut bureaucracies such as the HSE. They built up a level of government spending that was patently unsupportable, based as it was on tax revenues from the sandy foundations of the construction industry and the property market.

All this time we were led by a man who, by his own admission, could not manage his own finances. So how in God’s name could we have expected anything other than the mess in which we are now mired?

Ahern’s decade has seen arguably the worst government in the history of this State, certainly the most morally bankrupt. It has made paupers once again of the Irish people.

The leading figures of these administrations of the past twelve years – Ahern, Harney, McCreevy, Cowen, et al., are the real economic traitors.

Yours, etc,
ALAN McPARTLAND,
Rathfarnham,
Dublin 16.

Groundhog Day (again)

From an Irish point of view there is absolutely nothing new about the recent scandals involving Anglo Irish and other banks. Theft and fraud within the Irish financial sector has long being an integral part of Irish culture.

Such activity is common because the State itself officially accepts such behavior as the norm and, over the years, has developed a whole raft of mechanisms and strategies to protect those in the financial sector who regularly engage in criminal activity.

We only have to look back at any one of the many scandals of the past thirty years or so to confirm the truth of the situation.

In this case I’ve chosen the Ansbacher scandal because, like the Anglo Irish Bank scandal, it involves secret names and a golden circle.

It will be obvious after reading the following quotes, opinions and comments that nothing has or is about to change in corrupt Ireland.

((My comments are in brackets, emphasis mine).

On the 27th September 1999 the then Tanaiste, Mary Harney, gave the following excuse for not publishing the Ansbacher names.

“If the Government were to break the law and publish the names, everybody on the list would walk free and prosecutions would not be brought.”

(During the Ansbacher scandal Harney constantly made the case for secrecy because, she claimed that she was absolutely determined that prosecutions would follow, that justice would be done).

When the Ansbacher report was finally published in 2002, five years after the scandal was first uncovered, Mary Harney’s party colleague and Minister for Justice Michael McDowell cautioned against public expectations that a rash of arrests and prosecutions would follow.

(This is thinly coded message for the crooks – Don’t worry, our strategy of putting things on the very long finger worked, you’re all off the hook).

(Nobody was ever prosecuted for the Ansbacher criminality. Those involved did secret deals with Revenue and a few were banned from acting as company directors. The exact same strategy is being adopted by the present Government to protect the bankers).

Mary Harney (Still in office) must have had a moment of Déjà vu as she listened to Brian Cowen.

“Be assured that the suggestions being made quite frankly by political opponents that I’m in some way not very much in favour of bringing this into the public domain as soon as possible consistent with the proper investigation of this which wouldn’t put anything at risk or compromise any future prosecutions that would be deemed to be appropriate.”

Here are some more quotes from the Ansbacher scandal to confirm that strategies employed by government to protect the corrupt are still the same.

“The Fine Gael motion calls on the Government to ensure that names of all persons who held Ansbacher accounts are made public via a Dail committee.”

(The Opposition made the same suggestion regarding the Anglo Irish Bank names and the Government has rejected it, just like they did in 1999).

The Ansbacher report was finally published in 2002.

“The Director of Public Prosecutions James Hamilton is also considering a copy of the report. Responding to queries yesterday he pointed out that if any criminal offence disclosed by the report requires further investigation for the purpose of prosecution, this will be a matter for gardai, the Revenue Commissioners, the Director of Corporate Enforcement or the Central Bank.”

(As I mentioned, no prosecutions were ever brought).

“The Ansbacher report is not just a damning indictment of those wealthy and powerful individuals who evaded their due taxes, broke company law and engaged in criminal conspiracies from the 1970s to the 1990s, it reflects the failure of Irish regulatory authorities and professional bodies to uphold the standards required of them in the interest of the common good. There is a great deal to be ashamed of in the report and many lessons to be learned. New and rigorous standards must be applied by the authorities.”

(No lessons have been learned because the same corrupt administration is still in place)

“In a series of interviews at the weekend, the Minister for Justice, Mr. McDowell, hoped for a change in Irish attitudes so that people who engaged in multi-million pound tax fraud were not regarded as heroes in their local yacht clubs while those who fiddled their social welfare payments were sent to jail”

(Just recently, we heard Ulick McEvaddy refer to the Anglo Irish ‘names’ as heroes. He’s not the only one who thinks this way).

“Nobody believes it will be easy to successfully prosecute some of the extremely wealthy individuals involved. But, if a determined attempt is not made, the consequences will do lasting damage to our democracy. The belief that there is one law for the rich and another for the poor will grow and flourish.”

(Only the corrupt or the very ignorant would claim that there isn’t, in fact, one law for the rich and another for the poor).

“The Government will face strong opposition demands today for assurances that prosecutions will follow arising from the publication of the Ansbacher report.”

“The public must be shown that such behaviour will not be tolerated. The most obvious and public penalty is a jail sentence for the guilty.”

(Nobody went to jail; corruption in the business and political sectors is still rampant).

The following is a statement from the Paul Appleby, Director of Corporate Enforcement, on 6th July 2002, in response to the publication of the Ansbacher report.

It is worth reproducing in full to give an indication of what action we can expect from this toothless tiger regarding the Anglo Irish Bank scandal

6TH JULY 2002

I am determined that action will follow.

Speaking at a press briefing in Dublin on Saturday morning, Mr. Paul Appleby, Director of Corporate Enforcement, said:

“The company, now known as Ansbacher (Cayman) Ltd., secretly operated in this jurisdiction for over twenty years and conducted business which, the Inspectors have found, amounts to evidence tending to show that it contravened prevailing banking, tax, company and other legislation. When its activities came to light in 1997, the nation was shocked that such activity had occurred and had remained effectively hidden from official authorities for so long.

In a sense, these revelations infected our collective psyche in subsequent years, creating suspicions that it was possible to evade legal or other obligations without effective sanction and thereby undermining respect for the rule of law and damaging public confidence in the State’s institutions.

The conclusion of the Ansbacher inquiry and the publication of this Report represent, in my view, the first phase in purging these doubts and regaining lost ground. In defining publicly for the first time the company’s Irish business, the High Court Inspectors (past and present) have done a remarkable public service.

Indeed, the Companies Act 1990, and particularly the company investigation provisions of that Act, have again proved their worth and highlighted the importance of these legal provisions in investigating circumstances suggesting unlawful corporate conduct.

As this important phase of fact-finding investigation concludes, the relevant State Authorities, including my Office, will now examine what remedies are available to address the findings in the Inspectors’ Report.

My staff and I have commenced identifying the matters which fall within our statutory remit. Every line of potentially valuable inquiry will be examined thoroughly, and I am determined that appropriate action will follow. I am mindful, however, of the Inspectors’ comment (at page 18 of their Report) that they foresee some difficulty in bringing prosecutions arising from the matters investigated by them.

(Damn, there’s that Michael McDowell message to the corrupt again)

As early as next Monday, I will be seeking the approval of the High Court to gain access to certain of the Inspectors’ papers, in order to allow us to follow up on a number of issues in the Report. We will also be supporting in due course an application for the recovery of the costs of this Inquiry, in order that the taxpayer does not bear further financial loss as a result of the events described in the Report.

In the coming weeks, I will be considering what further action is warranted to remedy or sanction the conduct which is indicated in the Report and is relevant to my responsibilities under the Companies Acts.

I have no doubt that other relevant State Authorities, such as the Central Bank, the Revenue Commissioners and the Director of Public Prosecutions, will closely evaluate their own legal options in the light of the information contained in this Report.”

(They did indeed evaluate their legal options and, as is the norm in Ireland, did nothing).

Here are some comments on the Regulators in the report. (Note: The Central Bank was the so called financial regulator at the time).

“Failures by the Central Bank meant the Ansbacher scheme went undetected for years”

“The bank’s failure to test, appraise and gather information “available to it” resulted in the true nature of the activities going undetected for longer than ought to have been the case.”

“The bank had reservations at all times about the loan-book, but took at face value assurances by the scheme’s mastermind, the late Mr. Des Traynor, that the amount of loans extended to Irish residents was being run down.”

(Just as the present so called financial regulator took the word of Anglo Irish Bank lawyers that its controversial €300 million share deal last summer was above board. This is no accident, it has nothing to do with incompetence, it is, effectively, an official policy).

The Tánaiste, Ms Harney, on the failures of the Central Bank.

“It seems extraordinary that we lived in a time where the culture, even amongst State organisations, was one of ‘let’s pretend we don’t know’ because clearly in some cases where organisations knew or should have known they seemed to take the view that they didn’t want to know.”

(The exact same attitude and practices are still dominant in the Irish regulatory system today).

Writing in the Irish Times 8th July 2002 Mark Brennock made the following comments and observations.

“The Government must now reassure the scandal-weary public that this can never happen again.”

(Corruption within the financial sector never stopped, never even waned. That situation will continue for so long as Ireland remains a corrupt entity in itself),

“Governments are responsible for the level of regulation, and there was clearly a massive regulatory failure. This systematic evasion went on for over two decades, unhindered by the Central Bank, the Revenue Commissioners, company law regulators or prosecuting authorities.”

(Hardly an hour passes without some politician, journalist or banker telling the Irish people ‘there was clearly a massive regulatory failure’ regarding Anglo Irish Bank. We will continue to hear this into the future until somebody actually establishes a proper regulatory systems that puts people in jail rather than, effectively, facilitating their crimes)

“The Tánaiste yesterday pointed to a new system for regulating the accountancy profession, new legislation to encourage “whistle-blowers” and enhanced powers which have been given to the Revenue Commissioners.”

(None of this was done and politicians are still waffling on about the ‘urgent’ need for such reform as a result of the Anglo Irish scandal).

“The powers of a new financial services authority are detailed in a Bill currently before the Dáil.”

(This ‘new’ financial services authority was finally established in 2003. It was hailed as a powerful and hard hitting agency that would forever rid Ireland of the corrupt vermin that infects the financial sector – it was a complete failure.

Today this failed ‘authority’ is investigating itself for its part in the Anglo Irish Bank scandal. It will clear itself of all charges and continue to implement policy and secrecy laws that, effectively, protect fraudsters).

Then Tanaiste, Mary Harney on the Ansbacher report.

“The report is a watershed in Irish life” for the clarity of the insight it gives us of how a section of the political and business class in this State used to operate. The political task is to demonstrate to a scandal-weary public that it can’t happen again.”

(Harney is still in power and a scandal-weary public is still waiting).

And finally.

“The report showed that there was now the capacity in Ireland to “lift the veil of secrecy” over such activity. The Government had already begun the process of ensuring there was a coherent and comprehensive body of law to ensure “that our society is a fair and just place in which to live and do business“.

There is virtually no prospect that our corrupt system will suddenly decide to reform itself and therefore the only hope we have of ridding ourselves of the rampant corruption that infects our political, business and bureaucratic sectors lies with EU intervention.

I fervently hope, for all our sakes; that we see such an intervention before very long.

Copy to:
Financial Regulator
ODCE
Government

Nothing has changed

1999, September 27th. Tanaiste, Mary Harney, on the Ansbacher scandal names.

“If the Government were to break the law and publish the names, everybody on the list would walk free and prosecutions would not be brought.”

2009 February 20th. ODCE director, Paul Appleby, on the Anglo Irish Bank scandal names (Reported).

“The State’s corporate enforcer may be unable to provide the names of the ‘golden circle’ of investors to the Government for fear of prejudicing criminal proceedings.”

Nobody was ever prosecuted as a result of the Ansbacher scandal. Nobody will be prosecuted as a result of the Anglo Irish Bank scandal.

Minister Ryan – Nothing less than a fool

Anglo Irish Bank has now been sorted by the Government. The directors have all been paid off with massive golden handshakes and the billions owed by property developers will be paid by taxpayers.

Green Party Minister Eamon Ryan has said the top 15 customers in Anglo Irish Bank who each owe €500 million will be pursued to repay the debts in full.

This is not going to happen and the minister is nothing less than a fool to make such an assertion.

The billions owed by property developers to AIB and BOI will now have to be dealt with and the strategy will be the same. The directors will receive massive pay offs and all liabilities will be transferred over to taxpayers.

Comment from a victim of Irish corruption

I think this comment from below deserves publication.

I can honestly say that until I started following press articles and blogs after I lost over £80k in Anglo Irish shares as a result of nationalisation, I had no prejudice against any race. However, I must confess that now my eyes have been opened, I will avoid any dealings with the Irish in future.

I thought my son-in-law was talking rubbish when he said the Irish were crooked and that I should sell my Anglo shares. I will never doubt his word again. It is clear that corruption is widespread.

Lorna Lancaster