Interested in maladministration. Estd. 2005
The blame game has already started in the bacon crisis.
The Department of Agriculture said that monitoring the Millstream Recycling Plant fell within the remit of the Environmental Protection Agency.
The EPA, in classic Irish logic, said that inspecting the factory up to now was not its responsibility as the agency had not licensed the plant.
The Government is doing a very good job in recruiting allies to its strategy in the run up to Lisbon II.
The Oireachtas sub committee on European Affairs published its report on how to get around the democratic will of the people as expressed in Lisbon I.
Ireland could be “severely damaged” if things remain as they are and the country could suffer serious economic consequences in a two tier Europe the committee reported.
RTE also enthusiastically joined the Government’s campaign by doing a hatchet job on Libertas leader Declan Ganley. Ganley is seen by the Government as the greatest obstacle in its strategy to reverse the democratic will of the people.
The Standards in Public Office Commission, an organisation that’s usually as quiet as a mouse, has come out with all guns blazing in an effort to force Libertas to reveal the source of its funds.
Libertas has been issued with a formal warning and given one week to respond or face the consequences. To my knowledge this is the first time Sipo has actually issued a warning, formal or otherwise – to anybody.
The stark contrast between its strong attack on Libertas and its complete failure to challenge the secret funding of political parties suggests that this so called independent body is nothing more than a government pawn.
The McKenna and Coughlan judgements are also under attack. The McKenna judgement forbids government from using public funds to influence the outcome of a referendum. The Coughlan judgement ruled that both sides of a referendum should be given equality in terms of broadcasting.
Dr. Barrett, UCD School of Law said that the McKenna judgement “crippled the Government’s right to persuade the public of its cause and led to the emergence of groups such as Libertas.” The Coughlan judgement, according to Dr. Barrett “had the effect of neutralizing the role of political leaders.”
Clearly Dr. Barrett is deeply concerned by the problems an open democracy can cause to government wishes.
Fine Gael TD Jim O’Keeffe’s suggestion that the policy of giving equal airtime to both sides in a referendum debate “could result in a group such as a paedophile association being given 50 per cent coverage” is an indication of how obnoxiously low the Yes side are prepared to sink.
The continuing scandal at FAS is not important. We have seen hundreds of such cases over the past few decades; we will see many more into the future. What is important is the response to the scandal because it gives us a clear indication of how bad things really are in this country.
Brian Cowen responded by defending his pal Rody Molloy. This tells us that Cowen’s much lauded intelligence and leadership skills amount to nothing more than that of a typical Fianna Fail backwoodsman who will remain loyal to his constituents to the death but has little understanding of what’s going on in the wider world.
Mary O’Rourke accepts that some of the things that happened in FAS were unacceptable but is absolutely sure that such things are not happening in any other Government department. This is arrogant stupidity on a massive scale.
Rody Molly believes it’s all a media conspiracy to bring down FAS. This is the defence of a desperate man running out of excuses.
Bernard Allen (FG) chair of the PAC refuses to comment because he doesn’t want to prejudge the outcome of PAC ‘investigation’. This is a standard response for politicians who don’t have the courage to challenge the corrupt system.
That corrupt system is specifically designed to go around in circles so that nobody is held accountable. The powerless PAC will carry out an investigation and pass on their findings to the powerless C&AG.
The C&AG will then conduct his own investigation and pass his findings to PAC. PAC will then call in FAS officials (again) to ask them meaningless questions and the bureaucrats will reply with meaningless answers.
The whole thing will be widely covered in the media for a few days and then forgotten.
But by far the most serious aspect of this scandal, which seems to have been overlooked by everybody, is the continuing and alarming tendency of civil servants to take on powers to which they are not entitled or at least should not be entitled.
Recently we had the absolute refusal by the FSAI to name the water company responsible for supplying contaminated water to the public thereby putting the health of consumers at risk.
Just yesterday we had yet another report from the financial ombudsman, Joe Meade, outlining the outrageous exploitation of consumers by renegade financial institutions. Yet, Mr. Meade steadfastly refuses to name these vultures thus allowing them a free hand to continue exploiting consumers.
The FAS case is even more serious. When Senator Ross first submitted his FOI he was told that it would cost him €1,000. Later, he was told that the cost would actually be about €200.
Senator Ross believes, and I agree with him, that the civil servant lied to him in an attempt to prevent the release of damning information.
In a functional democracy Senator Ross would have immediately realised the gravity of the situation and reported the civil servant to an appropriate authority who would have sacked the corrupt civil servant on the spot.
Joe Duffy and Liveline (Wed) have taken on the responsibility of protecting the public from danger because the so called Food Safety Authority of Ireland (FSAI) is adamantly refusing to do so.
The FSAI is refusing to name a company which was found to have had high levels of contamination in its bottled water nearly a year ago.
Innocent water bottle companies such as Tipperary Water, Uisce, Ballygown and several others are phoning the show to reassure the public of the quality of their product and to protect their business from further damage.
According to Joe Duffy, the FSAI is still refusing to name the guilty party and say they will never reveal the name of any company that they have reprimanded – because it wouldn’t be fair.
There was a new and crucial piece of informaton revealed on the show yesterday.
Four months ago the FSAI did name a company, Pure Springs of Monaghan; that had problems with the quality of their product.
This raises very serious questions. Why the selective naming – Are deals being done?
Copy to:
FSAI
Yet another so called authority charged with protecting the interests of consumers has been found out.
The Food Safety Authority of Ireland (FSAI) discovered high levels of contamination in bottled water nearly a year ago but decided not to tell the public. Whatever the motives of the FSAI, the actual effect was to put consumers in danger while protecting the manufacturer.
This is a similar strategy to that employed by the so called Financial Regulator. Through a combination of stonewalling and secrecy laws, financial institutions are protected at the expense of the consumer.
It should also be noted that, once again, consumers only found out about this scandal through the media which, effectively, provides the only means of information and protection to Irish citizens.
Copy to:
FSAI
It seems that a majority of taxi drivers are against the recent increase in fares imposed by the Taxi Regulator, Kathleen Doyle.
The matter was hotly discussed on Liveline during the week but despite numerous contacts from RTE the regulator refused to discuss the matter on air.
Ms. Doyle’s press office is as far as RTE got before being contemptuously pawned off to a public relations company. This is the modern day equivalent of asking the peasants to use the workman’s entrance.
Ms. Doyle is a public servant and therefore, in theory, should be accountable to consumers. There has been a disturbing tendency in recent times for people like Ms. Doyle to adopt a certain royal distance from the great unwashed.
When public servants adopt such arrogant attitudes consumers are entitled to form their own conclusions. Here’s how I imagine Ms. Doyle would address the general peasantry if she ever deigned to dismount from her high horse.
Dear Peasants,
I have been elevated to a position of great importance and therefore feel it is entirely inappropriate that I should deal directly with ordinary people.
I have therefore, at great expense to you, employed a public relations company to deal with all awkward questions from an impertinent media. All questions of a suitably respectful and non awkward nature will be dealt with by my underlings – eventually.
Of course, I do acknowledge and indeed, on rare occasions, feel a degree of gratitude, that my high status, large pay packet, very generous expenses and myriad other perks are all paid for out of your meagre resources.
I would like to take this opportunity to wish all of you the very best of luck in your struggles during the coming economic depression.
I would ask you not to worry too much about my prospects as I am guaranteed regular pay rises, total job security and a very generous pension on completion of my reign.
Yours etc.
(Note to private secretary: Make sure that fellow Duffy gets a copy, it might keep him quiet)
Copy to:
Taxi Regulator
Liveline
My first reaction to the news that Sean Quinn is standing down as director and chairman of Quinn Insurance following breaches of regulatory requirements is – Suspicion.
The punishment meted out to Quinn Insurance is what we would expect to see imposed by a real regulator in a functional democracy. And this is what bothers me – The Irish Financial Regulator doesn’t really regulate but rather acts as facilitator to help financial institutions get out of trouble.
We know, for instance, that for years the Financial Regulator stood idly by as various financial institutions robbed millions from consumers. We also know that the regulator strictly enforces draconian secrecy laws that are designed to protect the financial institutions to the detriment of consumers.
Last week, for example, I rang the regulator to confirm reports that the chairman of Anglo Irish Bank, Sean Fitzpatrick, was under investigation over allegations of insider trading.
I was firmly told that section 33AK of the Central Bank Act 1942 that was inserted by section 26 of the Central Bank and Financial Services Authority of Ireland Act 2003 prevented the regulator from answering my question.
This law and its strict enforcement protects Sean Fitzpatrick and Anglo Irish Bank but puts consumers and especially shareholders in Anglo Irish Bank at a very serious disadvantage.
Keeping all this in mind let’s look at some of the details of the Quinn case and how it was handled.
The Financial Regulator imposed a fine of €3,250,000 on Quinn Insurance and fined Sean Quinn €200,000 because it had
“reasonable cause to suspect that breaches of regulatory requirements occurred in relation to QIL.”
What? The largest fines ever imposed in the history of the State on the basis of a ‘reasonable cause to suspect’. Over the years the Regulator has had incontrovertible evidence of widespread fraud in the financial sector and failed to take any action whatsoever.
So what, according to the Regulator, was the great crime committed by QIL?
“These breaches related to contraventions by QIL of obligations under the Insurance Acts and Regulations, including failure to notify the Financial Regulator prior to providing loans to related companies.”
This seems pretty tame stuff in comparison to other breaches of the law throughout the Irish business world. For example, in 2004 the Director of Corporate Enforcement (ODCE) reported that directors and connected persons returned approximately €100 million in loans from their companies.
The law prohibits directors from taking loans from their companies in excess of 10 per cent of relevant assets yet some of these directors had potentially illegal loans in excess of €1million from their companies.
According to the ODCE:
“In a number of individual cases these loans were for substantial sums or represented a large part of the value of the company and were very substantially in excess of the permitted limits.”
To my knowledge no action was taken against any of these directors, they just paid back the money and all was forgiven.
I suspect that there’s more to all this than meets the eye, it’s all too pat. Substantial details are thin on the ground and the manner in which the whole matter has been dealt is very suspicious.
Quinn himself is far too relaxed in the face of such a massive fine, even if he’s a billionaire. The ODCE is also very coy about the whole matter, simply stating that he was informed of the regulator’s sanction.
Can we take a clue from Quinn’s auditors and lawyers when they say that there are no corporate governance issues? Could the imposition of these extraordinary sanctions be a cover for something even more serious? Time may tell.
Copy to:
ODCE
Financial Regulator
On 4th Oct last I wrote:
“There will be no sacking of senior bank management, there will be no appointment of outsiders to bank boards or if there is they will be given the job of making the coffee. There will be no financial cost to the banks; there will be no strings attached to the deal because it is the banks that are calling the shots.”
Here’s what happened.
No banker has been sacked.
No banker has had his pay reduced or capped.
No banker has suffered any restriction on bonuses or share options.
The committee set up to oversee bonuses and pay for bankers is a joke.
No independent outsiders are being appointed to bank boards. The observers being appointed will be chosen by the bankers from a panel approved by the Minister. These observers will have no power whatsoever; they are nothing more than window dressing.
Ireland is the only Western state that has failed to take effective action against the greedy and irresponsible bankers – Why?
Again, on 4th Oct I gave the answer:
“We at Public Inquiry have been shouting the message for years – Ireland is a corrupt state, the politicians do not work in the interests of the people, the civil servants for the most part serve the politicians and the Government, not the people. Banks and other big business do as they please with impunity; they are never, ever brought to account. How long will it take before the message gets through?”
Let me be even more precise. Instead of acting in the interests of the State and its people the Government, the regulators and the bankers are acting to protect the corrupt system of administration that has evolved in Ireland over recent decades.
This is not to say that any person involved in the present scandal are themselves corrupt individuals. It is to say that the actions of those involved are exactly what can be expected from those who are making decisions within a corrupt system.
This is why people like Shane Ross, David McWilliams and others always express puzzlement at the reaction of politicians and regulatory authorities to these scandals.
Their mindset includes an assumption that Ireland is just like any other any other Western democracy. They assume that the Government and regulatory authorities will always act in the best interests of the State and its people. This assumption is the fatal flaw in their reasoning.
During the period when we were waiting to see the details of the guarantee scheme that the Government and regulatory authorities were working out with the greedy and irresponsible bankers these financial experts expressed views on what action would or should be taken.
They are now expressing shock that all their predictions and analysis turned out to be wrong. They have expressed astonishment that the Government has, in effect, allowed the bankers off the hook.
Why is it that we here at Public Inquiry can make an accurate prediction of how the authorities are going to act based on our analysis of the situation and all the experts get it wrong? The answer is simple – We start off from the undeniable fact that the administration of Ireland is intrinsically corrupt.
Once this fact is accepted everything else falls into place. There will be no surprise when banks and other financial institutions are allowed to rob their customers, no surprise when state authorities fail to act against stock market fraudsters, no surprise when politicians who blatantly commit perjury are not made accountable.
Nothing will change in this country until the reality of what we are as a nation is accepted. No individual, organisation or state can begin to reform itself until the reality of their situation is faced and accepted, it is only when that point is reached that the rot can be cut out.
We are a long way from that place.
Copy to:
Senator Ross
Financial Regulator
Understandably, all attention will be on today’s hair shirt budget but believe me it is a minor event in comparison to the following statement from the CEO of the Financial Regulator, Patrick Neary, to the Joint Oireachtas Committee on Economic Regulatory Affairs (RTE News, 1st report).
“The six Irish banks covered by the (guarantee) scheme have a total regulatory capital base of €42 billion. This figure takes account of provisions of €2.1 billion against impaired loans totally €3.6 billion. Speculative lending to construction and property development in Ireland amounts to €39.1 billion of which €24 billion is supported by additional collateral or alternative sources of cash flow and realisable security. This leaves a balance of €15 billion secured directly on the underlying property.”
This, in effect, means that the six banks in question are insolvent and will have to be bailed out by the taxpayer.
The €15 billion that Neary mentioned is only a minimum estimate of the massive bill facing Irish taxpayers. It is very likely that at least a portion of the €24 billion allegedly supported by ‘additional collateral or alternative sources of cash flow and realisable security’ will also prove to be lost money recklessly loaned out by greedy bankers.
Neither did Neary make any mention of taxpayer’s exposure as a result of the extended government guarantee to a number of non Irish banks last week.
Irish taxpayer’s could be facing a bill of between €20 and €25 billion.
Here’s what the so called Financial Regulator is going to do in response to the disaster.
“We will immediately recruit an additional 20 senior supervisory staff with banking experience to be placed on site (pun, I assume, not intended) in key banks to monitor developments. We are now requiring banks to set out new business plans focusing on the need to reduce their risk profile and how their models of banking are sustainable in the new environment. There will be enhanced reporting obligations in relation to capital, asset quality and individual large loans to supplement our daily liquidity reporting requirements.”
This, of course, is pure bullshit. What’s the point of requiring banks that are now insolvent because of their reckless greed to focus on their need to reduce risk?
It is, of course, no accident that Neary announced the full extent of the nightmare facing Irish taxpayers on hair shirt budget day. He’s using the event as a means of covering up his own incompetence.
But then again he’s only following the example of the Government who are hiding behind the global financial crisis to cover up the crucial part they played in allowing bankers and property speculators to destroy the economy.
Neary on Prime Time recently:
The chairman of Anglo Irish Bank, Sean Fitzpatrick, is being investigated by the Irish Stock Exchange over allegations of insider trading. The investigation will, of course, be a farce. The ISE, like the Financial Regulator, doesn’t really do regulation.
Fitzpatrick bought €1.1 million worth of Anglo Irish shares after talks had opened between the banks, the Financial Regulator, the Central Bank and the Government.
The banker turned a tidy little profit of €326,000 from the deal when Anglo Irish shares increased by 18pc after the Government bail out was announced.
Still, despite having nothing to fear from the ISE, Fitzpatrick was foolish to allow himself to be ambushed by Marian Finucane in a recent interview (Sat. 4th Oct).
Finucane very cleverly massaged Fitzpatrick’s ego by asking him how influential he was in the €400 billion government deal with bankers.
Fitzpatrick couldn’t resist asserting his self importance; here are some of his comments before he finally realised he was being set up by Finucane.
“I knew lots of things were happening because we had discussions obviously with the Central Bank and the Financial Regulator and the Dept of Finance over the previous weeks.”
“Well, I met the Dept of Finance officials and I met the Minister and clearly I spoke on a regular basis with the regulator and the central bank.”
Finucane asked him about his contact with Minister for Finance Brian Lenihan.
“I was explaining the difficulties and he was explaining the difficulties they had, there was lots of things being discussed by lots of people in different ways… We had to get the difference between what was happening externally and get that across and remove the issue about the bad debts…which we eventually did and he saw that very, very clearly.”
“What I was trying to do was explain the situation to him, we certainly exchanged ideas”.
Fitzpatrick finally realised he was being set up when Finucane asked him about a report in the Sunday Independent concerning allegations of insider trading. Suddenly, the banker wasn’t so influential.
“Did you have a sense that the Government was going to bail out the banks, asked Finucane?”
“No, I didn’t.”
“Did you not know before hand that the Government was going to bail the banks out?”
“Of course I didn’t, that wasn’t out until Monday night.”
“But you had been talking to the Minister the previous week.”
“I had been talking to the Minister the previous seven days about various issues, about what he could do but I wasn’t sure what he was going to do..”
“Were the banks all talking to each other at this stage?”
“Not on a constant basis…there was no cohesive, no group meeting with the Government at all.”