Prime Time Investigates the banking system and regulation tonight

Monday 21st December 9.35 pm RTE 1
Available here via the RTE Player.

In-depth reports on major issues affecting Irish society. Oonagh Smyth reports on events within the Irish banking system before the economy fell into crisis

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Interesting program allright. Some of those lending practices were shocking.

Funny that those who defraud the taxpayer get named and shamed by the Revenue, regardless of whether the tax evasion was intentional, misguided ,misadvised or purely with intent. Surely once an investigation is up and running, those who acquired loans without the proper documentation should also fall into a similar category and their information be published, detailing how much taxpayers are footing the bill for their greed.
And dont let me hear anyone say well those Fianna Fail politicians wouldnt have got the loans if the like of Irish Nationwide didnt facilitate them. First rule in politics is CYA.
BTW I'm more than suprised that this thread isn't 50 pages long already, or is everybody speechless?

roro123 said:

Funny that those who defraud the taxpayer get named and shamed by the Revenue, regardless of whether the tax evasion was intentional, misguided ,misadvised or purely with intent. Surely once an investigation is up and running, those who acquired loans without the proper documentation should also fall into a similar category and their information be published, detailing how much taxpayers are footing the bill for their greed.
And dont let me hear anyone say well those Fianna Fail politicians wouldnt have got the loans if the like of Irish Nationwide didnt facilitate them. First rule in politics is CYA.
BTW I'm more than suprised that this thread isn't 50 pages long already, or is everybody speechless?

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CYA!!! its the first rule of business!

There is simply no comparison between tax evasion and not completing the required paperwork for a bank loan.

The paperwork for money laundering is hugely inappropriate. Under the law, Charlie McCreevy would have had to provide a passport and two utility bills. Everyone in the Irish Nationwide knew him. I would have no problem with them not complying with this law.

His ability to repay the €1.6m loan should have been assessed. I don't know if it was or not.

I am not defending the Irish Nationwide practices - I am pointing out that it is not appropriate to compare them with tax evasion, which is a criminal offence.

Brendan

I have to say I found it a very intersting programme. It confirmed a few things that were always rumoured.

Couple of things I really found interesting were the loans to politicians (Morgan Kelly, I think it was made a good point that policitians should have to disclose their liabilities well as their assets).

The part played by the regulator and Central bank in the loans between IL&P and Anglo. Their were always stories that IL&P were seriously annoyed because they thought they acting with the regulators and central banks consent and that seems to be confirmed.

Also confirms that the man on street seemed to grasp the seriousness of the situation alot quicker than bankers, regulators and policitians did when the banking crisis began.

The interesting bit for me was the information about the Regulator's attempts to take on Irish Nationwide in 2004 and get them to control their lending practices and reduce Fingelton's personal control.

Fingleton/Walsh obviously just gave two fingers (pun intended) to the Regulator. Did the Regulator have no power to get on top of this?

I was glad to see nothing illegal actually occured

Sunny said:

Their were always stories that IL&P were seriously annoyed because they thought they acting with the regulators and central banks consent and that seems to be confirmed.

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I was a bit confused by this. As I understand it...

The transaction took place.
The Financial Regulator,at a lower level, became aware of it afterwards, but before the Anglo Irish accounts were published.
A senior person in the FR phoned to confirm that this transaction had taken place.

I presume she was phoning to check up on the information supplied by her junior staff? It was not a pre-approval of the transaction though.

It's odd then that the FR did not insist that it be disclosed in the accounts as an artificial transaction. However, I understand the FR's problem - by highlighting this, they would have caused a run on Anglo. I understand it - but I don't agree with it.

Brendan

Brendan, the criminal justice act was delayed and delayed by politicians like Lawlor et al, I don't care if everyone in Nationwide knew who their customers were, it is paramount that the paperwork and the assessment are carried out correctly . It also breeds the perception that these characters are outside the law. How many bank accounts did Liam Lawlor have in different names and shelf companies trying to hide illegality? Not adhering to the criminal justice act is illegal, just as forgetting to settle your tax matters. This whole mess confirms that there is a conspiracy at the highest levels and that there is one rule for the rich and one rule for the poor. On the issue of liabilities being disclosed, a sitting TD must resign their seat if they are deemed bankrupt, it nearly and possibly should have happened to Cooper Flynn. There is no doubt that NAMA is hiding some very murky and undemocratic dirt.

The comments about Central Bank inspections tallies with my recollections of a time I worked for a foreign bank. CB inspections did not seem to generate much concern while Head Office inspections every couple of years brought 2 months of fear and loathing........the latter were career changing events.

not surprised but very angry watching that last night

as i saw it...anglo create the rush into madness, the establishment banks come under pressure to match anglo's profits and join in, irish nationwide were going along at their own fiery pace but not enough to upset the establishment banks like anglo did

financial regulator becomes aware of some questionable transactions, central bank likewise but all seem to back off or just send letters....why?

because politicians are afraid of their lives of the whole thing collapsing and not enough revenue coming into the coffers from over extended property buyers and commercial property transaction taxes to cover the benchmarking/increased dole and pensions/their own high salaries...plus some of them are very 'friendly' with the banks and don't want to rock the boat as it might expose them in any investigation

so the central bank and financial regulator keep going with the softly softly approach, not that they seemed to have the intelligence or capacity to do otherwise in any case even if the Govt said 'get tough' with the banks.

1 thing has always puzzled me in this whole sorry episode....how come no journalist worth his salt was breaking stories on this...i.e. talking to sources in the banks or the regulator, disgruntled developers who were'nt getting the same treatment, some politician with a conscience keen to reveal what was going on so as to maybe get at Bertie, etc etc
Why not?....we all know now from last night....banks were given loans without the proper paperwork/questions being asked on demand to 'senior politicians, millionaire sportspeople and journalists'. So the banks were keeping developers, politicians and journalists happy...the circle was completed!
A lot of people on the street knew of stories where in major developments some leading and not so leading lights of provincial rugby teams were being given 1st option to buy apts/houses ...a way to publicise the development through word of mouth plus for the developers/estate agents to hang out and make friends with sporting heroes....but not everyone in rugby in ireland makes a big salary and could possibly afford to be in on those deals.....yet no journalist ever looked into these stories.
Heard some similar stories about GAA players and they earn 'nothing' from the sport...

Complainer said:

The interesting bit for me was the information about the Regulator's attempts to take on Irish Nationwide in 2004 and get them to control their lending practices and reduce Fingelton's personal control.

Fingleton/Walsh obviously just gave two fingers (pun intended) to the Regulator. Did the Regulator have no power to get on top of this?

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That's what struck me as interesting as well.

"1 thing has always puzzled me in this whole sorry episode....how come no journalist worth his salt was breaking stories on this..."

Because the newspapers were bought and paid for by the property industry? 70% of the Irish Times' income came from it, for example. A senior business editor could get the sack for as little as making a wisecrack about an estate agent being unable to sell their house - in that kind of climate, why stick your head above the parapet? Far better to be a Liz O'Kane or a Isabel Morton, write some gushing property porn, and collect your cheque.

It's not like the public would thank you. People, after all, were happy to know that their house was worth even more and more every year. People who pointed out that this could not last forever were labelled hysterical, and told by our former Taoiseach to commit suicide.

The good old days, as we call them.

Brendan said:

The paperwork for money laundering is hugely inappropriate. Under the law, Charlie McCreevy would have had to provide a passport and two utility bills. Everyone in the Irish Nationwide knew him. I would have no problem with them not complying with this law.

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And what if it later transpired that Charlie was laundering money, but the DPP was unable to launch a prosecution because proper procedures were not followed when the account was opened?

How often have the gombeen Irish "elite" escaped punishment because it's one law for them and another for the rest of us?

Give it a rest Brendan, I'm sick of that mentality and where it's lead us.

You miss the point completely.

The purpose of the legislation is so that the person can be positively and definitely identified. If a stranger walks into AIB to open an account, they must confirm their identity by supplying esb bills and passports.

There was no loss whatsoever to anyone by Charlie McCreevy's alleged failure to provide these.

As far as I know, it derives from Money Laundering legislation which is often totally inappropriate in practice.

I have been the most vociferous critic of Michael Fingleton and the Irish Nationwide over the years. Criticising them over minor technical issues, diverts attention from the much bigger issues.

I put down a motion of no confidence in Fingleton at the AGM some years ago. It was overwhelmingly defeated by the members who expressed their confidence in him. Had he been kicked out then, it's just possible that a new MD might have prevented the Society from its current bankruptcy.



Brendan

Brendan said:

You miss the point completely.

The purpose of the legislation is so that the person can be positively and definitely identified.

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As do you.

The purpose of the legislation is to set a benchmark to legally establish identity in case of money laundering.

If the legislation is not complied with, and a crime is subsequently committed, the first thing the defendant's legal team will fall back on is the financial institiution's failure to comply with proper procedures in opening the account.

They can use this to establish "reasonable doubt" as the required procedures were not complied with, therefore my client gets off scott free. And now my client is going to sue the State (ie everyone else) for bismirching their otherwise impeccable character.

But we are prepared to take a high six figure settlement, to make it all go away quietly.

That's how de game is played in Ireland Brendan.

What rock do you live under?

Brendan said:

I have been the most vociferous critic of Michael Fingleton and the Irish Nationwide over the years. Criticising them over minor technical issues, diverts attention from the much bigger issues.

I put down a motion of no confidence in Fingleton at the AGM some years ago. It was overwhelmingly defeated by the members who expressed their confidence in him. Had he been kicked out then, it's just possible that a new MD might have prevented the Society from its current bankruptcy.

Brendan

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This is what I don't understand Brendan. Everyone knew what was going on in Irish Nationwide and yet so few people seemed to be willing to do anything about it. The question has to be asked if his political ties helped him especially with regard to the regulator. The wider investment community who funded them also have questions to answer. I know that doesn't explain the members lack of support for your motion but I think that can be explained by the $ signs flashing before their eyes!

Brendan said:

I put down a motion of no confidence in Fingleton at the AGM some years ago. It was overwhelmingly defeated by the members who expressed their confidence in him. Had he been kicked out then, it's just possible that a new MD might have prevented the Society from its current bankruptcy.

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Brendan, I'm interested to know why you consider Fingleton far worst than any of the other banking leaders. Note that I'm not defending him in any way; I'm pointing out that they have all been just as reckless. As taxpayers, we're having to bail them all out.

Also, was the motion of no confidence related to demutualisation rather than Irish Nationwide's lending practises?

canicemcavoy said:

I'm not defending him in any way; I'm pointing out that they have all been just as reckless. As taxpayers, we're having to bail them all out.

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Fingers only has €8 billion going into NAMA, Seanie has €28 billion.

Seanie must have been 3.5 times more confident and positive about the Irish "economy".

Shame on you Fingers.