Category: Regulatory Agencies

Latest: Fianna Fail found not guilty

I received a decision from the Standards in Public Office Commission today regarding my formal complaint in relation to allegations that Fianna Fail had failed to disclose tens of thousands of Euro in corporate donations.

After four months of investigation and deliberation the Commission found that Fianna Fail had not broken the law. I would have been astonished if the outcome had been any different.

Dear Mr. Sheridan,

Thank you for your correspondence, dated 21 May 2009, in relation to a report published in the Irish Examiner, on 18 May 2009 and donations made by Durkan New Homes Ltd. To Fianna Fail.

The Standards in Public Office Commission has completed its investigation into this matter and has considered the responses from Fianna Fail and Durkan New Homes Ltd.

The Commission considered the responses at its meeting yesterday. In light of the explanations furnished the Commission is satisfied that there was no failure to comply with the provisions of the Electoral Act, 1997 (as amended).

There will be no further action in this case.

I rang SIPO to request a copy of the explanations furnished to the Commission by Fianna Fail and Durkan New Homes Ltd.

I was advised that it would be better if I submitted an FOI to avoid any possibility of legal action been taken against members of SIPO.

That raised my eyebrows a bit but an FOI will be on its way soon.

Irish Examiner report
Previous post

So, all in all, a great big happy (incestous) family

Senator Shane Ross writes today about the various activities of former Financial Regulator, Liam O’Reilly.

O’Reilly is a director of Irish Life & Permanent and, at the same time, chairman of the Chartered Accountancy Regulatory Body (CARP) which is investigating the €8 billion deposits exchange between Irish Life and Permanent and Anglo Irish Bank last year.

Not to worry though, a spokesman for the Institute of Chartered Accountants of Ireland, the body that oversees CARP, said that in their opinion there was no conflict of interest – Well, that’s all right then. If the ICAI is happy, we’re all happy.

Senator Ross also reminds us that O’Reilly was the Financial Regulator who failed to act against AIB overcharging in the years leading up to 2001. And as we witnessed last week AIB is still faithfully preserving that age old traditon of overcharging by Irish banks.

The Senator didn’t mention that O’Reilly is also a company director of Merrill Lynch which is under investigation for a potentially massive irregularity which may involve undisclosed losses of £284 million.

The Financial Regulator is ‘monitoring’ the situation but, as usual, is unable to make any comment because of strict secrecy laws.

And of course Merrill Lynch is also advising the Government on how to manage the financial crisis.

So, all in all, a great big happy family.

FÁS case: Fighting the 'disease' of accountability

In a previous post (Defending a failed state) on the FÁS scandal I outlined the sequence of events:

An anonymous letter was sent to Mary Harney which triggered an internal investigation in FAS which triggered an investigation by the C & AG which triggered an investigation by the PAC and when the PAC completes its investigation in January it will refer back to the C & AG who will conduct yet another investigation (This is where I get facetious) who will refer back to FAS who will refer back to Mary Harney who will refer back to the anonymous letter writer thus completing the circle of madness.

That investigation by the useless C&AG is now complete and the parcel has been, once again, handed back to the useless Public Accounts Committee who, once again, is going to investigate (Irish Independent).

We must remember that there’s logic in maintaining this circle of madness. In a corrupt state it is of the utmost importance that reality is never, never, never actually faced – to do so raises the appalling vista that somebody might be held accountable.

If the ‘disease’ of accountability was allowed to take hold and spread out of control it could threaten those who have a vested interest in protecting the rotten system.

Banking error or scam – We'll never know

Once again Irish consumers find themselves the victim of a ‘banking error’. Customers of Bank of Ireland have been ‘mistakenly’ double charged to the tune of millions on their Laser cards (Irish Independent).

These so called ‘errors’ are very common in Ireland and always follow the same pattern.

The ‘error’ always favours the bank never the customer.

It’s always a customer, the media or a whistleblower who notices the ‘error’ – never the bank, never the Financial Regulator.

Bank officials are never to blame; it’s always the fault of a computer.

The bank always apologises because apologies are magic in Ireland – they completely wipe any need for accountability.

The bank always promises that the ‘error’ will never happen again – It always does.

The bank is allowed to investigate itself and report to the Financial Regulator in its own good time, if ever.

The bank is never punished for such ‘errors’. They are merely required to return monies robbed or taken in ‘error’.

Bank of Ireland spokesman, Brendan Nevin, was asked about the bank’s contact with the Financial Regulator (News at One, 2nd report).

We have been in contact with the FR explaining what happened and in due course we’ll confirm the full details of our investigation to the regulator.

Because banks are not actually regulated by the Financial Regulator Nevin became confused when asked if the FR wanted the bank to do anything else; he spluttered in reply.

Well, in general the FR would want us to be clear about all our facts which is what we’re doing at the moment.

We’ll never know whether this incident was a genuine error or yet another scam to rob customers because the so called Financial Regulator has no interest in protecting consumers and banks, who are still allowed to operate pretty much as they like, are unlikely to admit wrongdoing.

Copy to:
Financial Regulator

Senator Boyle, bankers and the ODCE safe house

A recent article in the Financial Times analysing Ireland’s economic woes quoted Green Party chairman Dan Boyle on the question of making bankers accountable.

I have strong hopes that the ongoing investigations of the director of corporate enforcement and others will lead to the prosecution of those in the banking system who broke the law. But as yet, there is no opportunity for the senior bankers – some of the best-paid people in our society – to account for the catastrophic failures in their organisations, for which we will all have to pay.

It’s difficult to tell whether Boyle’s integrity has been seriously damaged by his association with Fianna Fail politicians or if he’s genuinely naïve in thinking that bankers will actually be brought to account.

I know I’ve said it before but it really does need to be repeated – No banker will be brought to account unless there’s a virtual revolution in the way the corrupt Irish state deals with white collar crime.

Boyle is a fool if he genuinely believes that the Office of Corporate Enforcement (ODCE) has the power or resources to make bankers accountable – it does not.

The ODCE deals with small time infringements by small time business people but, in effect, it also acts as a safe house for those who have committed or are under suspicion of major white collar crime.

The idea is simple but very effective – when suspicions of or actual white collar crime is uncovered the cases are transferred to ODCE where they stagnate for years until they are forgotten.

The guilty have nothing to fear from ODCE as its powers are pathetic, usually involving nothing more than a ban of a couple of years from acting as a company director.

The following is a list of those currently enjoying the safe haven that is the ODCE.

The Bailey brothers – Engaged in long-term tax evasion (made a €22 million settlement with Revenue), bribed public officials, gave false evidence under oath and obstructed a public inquiry.

National Irish Bank officials – In charge when millions were robbed from customers and the State.

Jim Flavin of DCC – Found by the Supreme Court to have defrauded the Irish Stock Market of €83 million.

None of these people will suffer any loss whatsoever as a result of their activities. They, and the bankers who have recently joined them in the ODCE safe house, will continue to enjoy the effective protection of the ODCE for so long as politicians like Dan Boyle remain ignorant of what’s really going on in this country.

Copy to:

Senator Boyle
ODCE

How long before Ireland reaches accountability standards of Nigeria?

Nigeria, one of the most corrupt countries in the world, has arrested fifteen top bankers on charges of conspiracy and money laundering.

The head of Nigeria’s Economic and Financial Crimes Commission said that the bankers were taken into custody to make sure they didn’t leave the country as officials examined banks that have piled up billions in bad debts.

The governor of the Nigerian Central Bank has also fired the heads of five banks for mismanagement.

Ireland, which likes to see itself as a first division Western democratic state, has never, in its entire history, arrested a banker despite the fact that countless millions have been robbed by financial institutions over the years.

Ireland’s Central Bank has never, in its entire history, fired a banker.

Ireland does not, and never has had, an anti corruption agency equivalent to Nigeria’s Economic and Financial Crimes Commission.

Note: It’s interesting to see that the EFCC has a ‘most wanted’ list. Could Irish citizens, even in their most demented dreams, ever conceive of seeing such a list on the Financial Regulator’s website?

Copy to:
Financial Regulator
Central Bank

Denis O'Brien's media empire and the Moriarty Tribunal Report

obrien460Vincent Browne has an interesting article in today’s Irish Times where he asks some searching questions about Denis O’Brien’s media empire and how The Broadcasting Commission of Ireland (BCI) could possibly conclude that:

The media holdings of Denis O’Brien do not constitute dominance in terms of his ability to influence opinion forming power in any of these franchise areas.

Browne makes the connection between O’Brien’s media empire and the soon to be published Moriarty Tribunal Report.

Last weekend two of the newspapers that he now controls, the Sunday Tribune and the Sunday Independent, published two self-serving interviews with him, intended to take the “sting” from the anticipated final findings of the Moriarty tribunal on the award to him of the mobile phone licence in 1996.

He goes on:

If his own version of the Moriarty tribunal findings prove correct, they would be a devastating indictment of himself, along with the then minister for communications Michael Lowry, and of civil servants involved in awarding the licence.

If his version is true, he will be accused of the most spectacular piece of corruption ever in this State, with the possible exception of the Irish Hospital Sweepstake scam.

And, it will seem, if what he says is true, that he has built his vast personal fortune on the basis of a criminal act.

A letter writer to the Irish Times also has his say about O’Brien’s media spinning.

Madam,

I was embarrassed last weekend to read the coverage of Denis O’Brien’s tribunal troubles in the Sunday Times . A front page article took leaked information about the Moriarty tribunal’s conclusions (not very positive it must be said) and managed to portray Mr O’Brien as some sort of hero, who was battling the tribunal to save the State money on legal fees.

Further on in the paper, there was a full-page spread on the excessive costs of the tribunal and yet further on, Mr O’Brien adorned the front page of the Business section about some triviality or other.

What could have been the spur to such embarrassing spin? Perhaps the Sunday Times is in awe of Mr O’Brien’s recent ascent to control of IN&M?

Yet another example of the need for The Irish Times to issue a Sunday version, thus sparing the public from the brainrot of the Sunday press.

Yours, etc,
TOMMY TIGHE,
Grove Park,
Dublin 6.

Irish Financial Regulator – Still protecting the scumbags

Senator Shane Ross was writing about the Financial Regulator’s annual report last Sunday. The Senator continues to be astonished and staggered by the activities of our so called regulators.

Here are some of the things that staggered and astonished the Senator.

The chairman of the Financial Regulator, Jim Farrell, is a banker. Farrell was the boss of Citibank for many years. The publication of such details are the norm in accountable democracies but apparently rare in Ireland.

Such incestuous behaviour is not, however, unusual in Ireland. The bankers are on the regulators staff and it is quite common for regulators to end up as bankers after retirement. All part of the ‘old boy’s network’, old chap.

The Senator goes on to speak about the culture of secrecy at the Financial Regulator’s Press Office.

Their instincts for secrecy are ingrained. The watchdog’s press office must be a paranoiac’s paradise. Every question asked, however innocent, receives an evasive answer.

Tell me about it Senator. My efforts to get a straight answer from the Senior Press Officer last week was like trying to get blood from a stone.

And then there’s the ‘business travel’. Last year it came to €795,000 and this year will see a massive 22% increase to over €970,000. But, alas, as the Senator points out, taxpayer’s (peasants) are forbidden from knowing the details because the FR is protected by State secrecy laws.

In common with the rest of the media Senator Ross didn’t seem to notice that Farrell had, apparently, announced a major new policy to replace the principled based approach to financial regulation.

I rang the Department of Finance today to ask some questions about this alleged new policy and what happened, yes you’ve guessed. I received the same treatment that I received from the FR Press Office – waffle, stonewalling and riddles.

So just let me repeat – Neither the financial regulatory system nor the attitude of its staff has changed one iota. It is still the same secretive, arrogant system that has for many years protected the scumbags that infest the Irish financial sector.

Copy to:
Financial Regulator
Senator Shane Ross

Financial Regulator's annual report – A dishonest whitewash

The Financial Regulator’s annual report, published last Tuesday, contains one very clear message that, depressingly, went completely unnoticed by the media.

That message is – Absolutely nothing has changed; the old regime is still in place; the old attitudes are still dominant; the interests of the people and the country will continue to take second place ahead of the interests of a ruthless and deeply corrupt financial sector.

Dodgy financial institutions will continue to enjoy full protection under a mountain of bureaucratic waffle and strict secrecy laws enthusiastically enforced by FR staff.

Jim Farrell is the public face of this disgraced and discredited Financial Regulatory regime. In an interview on RTE (5th report) he claimed that:

the way the country’s banks are now regulated is fundamentally and forever changed.

It is reasonable to assume from this statement that all is well at the Financial Regulator, that major reforms have been put in place which will protect consumers forever into the future and bring to account the corrupt vermin that have infested the Irish financial sector for decades.

In other words, it is reasonable to assume that Mr. Farrell has announced a virtual revolution in Irish regulatory methods and that from now on his organization will act in the interests of Ireland and its citizens rather than the interests of (dodgy) financial institutions.

The (revolutionary) measures announced by Mr. Farrell are as follows:

Extra staff with additional skills.

A more questioning and forensic approach to regulation.

Staff from the Financial Regulator are now on site in banks that are covered by the Government guarantee scheme. These people are full time and are monitoring the activities of banks.

The first two measures can be dismissed for the waffle that they are but the third measure is interesting.

My understanding of the presence of FR staff in the banks is that they are there in a temporary capacity as a result of the economic collapse and subsequent scandals.

I assumed, obviously wrongly, that once the crisis was over and banks were returned to private ownership that FR staff would also withdraw.

My understanding now, as a result of Mr. Farrell’s announcement, is that FR staff will become a permanent fixture on the staff not just of those banks under government guarantee but of all financial institutions to ensure that no such scandals could possibly recur.

To confirm this I contacted the Financial Regulator and spoke to the Senior Press Officer, Gill Forde.

Ms. Forde confirmed that it was official policy to have FR staff permanently on site in the covered institutions.

What about other financial institutions?

We are currently recruiting and enhancing our expertise in all of these areas and that’s the only detail I have for now.

My understanding from what Mr. Farrell said is that the banks covered by the Government guarantee are now going to have full time staff from the FR on a permanent basis.

Yes.

Even when they’re returned to private ownership?

He said the approach has changed and he was referring to principles based supervision.

What I’m inquiring about is the entire financial sector. Is it the policy of the FR to put their staff in all banks on a permanent basis?

The FR as you will be aware, there’s new legislation being brought forward by the Government forming a Central Bank Commission and I don’t have any more information.

I’m just going on exactly what Mr. Farrell said – The country’s banks are now regulated fundamentally and forever changed and one of the measures he has taken is to put people on site full time in those banks covered by the government guarantee.

Correct.

My question is – Is that a permanent policy, that FR staff will continue to monitor those banks forever and not just until the crisis is over?

I don’t have any information further than to say that that is our regulatory approach to supervising the banks.

So really what you’re saying is you don’t know.

I’m not saying that, I’m just saying that it’s a regulatory approach to supervising the banks.

Could you refer me to somebody who could answer the question?

That is our response.

I don’t understand your response; Mr. Farrell is saying that full time staff has been put on the banks

Exactly and that’s because the principles based approach no longer applies.

Are you saying that the placing of full time staff in the banks is a replacement for the principles based approach.

Yes, I am.

But it only applies to financial institutions under government guarantee and not to the entire financial sector?

The Regulator has been realigning with the new provisions and we are recruiting additional staff across the organization with the focus on risk, governance and enforcement

I tried to press the matter but Ms. Forde said she had to go and hung up.

Here’s my summary.

Mr. Farrell was being dishonest in suggesting that the temporary arrangement of placing FR staff in the banks was a major, industry wide and permanent reform.

(I say ‘temporary’ because nobody seriously believes that the banks would allow the Regulator to closely monitor their activities on a permanent basis)

In my opinion Mr. Farrell was just talking rubbish, just mouthing meaningless words to dishonestly convey the impression that substantial change had occurred that would, for the first time in Irish history, see genuine financial regulation.

Ms. Forde’s arrogant and dismissive reaction to my questions is exactly what I have come to expect from FR staff over the years. The attitude is still the same – Bureaucratic waffle, refusal to answer even the simplest questions and always the big stick of state secrecy laws.

Ms. Forde’s claim, for example, that the placement of FR staff in banks is a replacement for the principles based approach to regulating banks is, in my opinion, insulting waffle.

If such a major policy shift was in operation I wouldn’t be hearing it from a FR press officer, I wouldn’t even be hearing it from the chairman of the Financial Regulator on RTE News. I would be hearing it from a Government press conference chaired by the Minister for Finance as he announced to the world that Ireland had finally decided to take financial regulation seriously.

A much more disturbing aspect of this situation is the reaction or, more accurately, the non reaction of the media.

The publication of this year’s annual report by the Financial Regulator is arguably the most important event in Irish financial regulatory history.

It is the first annual report following the collapse of the economy which exposed the Financial Regulator as an incompetent toothless tiger unable or unwilling to reign in rogue elements in the banking sector.

This incompetence by the FR played a major role in the destruction of the economy and by extension is at least partly responsible for the massive financial and social damage to the people of Ireland.

Despite this, the media and in particular RTE effectively ignored the report and the fantasy (dishonest) claims made by Mr. Farrell.

This ignorance of what is really going on within the financial regulatory system and other so called regulatory agencies is a major contributing factor to the financial catastrophe now facing this country.

Copy to:
Financial Regulator
Financial Regulator (Press Office)
RTE