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THE GOVERNMENT HAS announced that it will move to establish a banking inquiry early next week in the wake of the conclusion of the trial of two former bankers at Anglo Irish Bank.
With two former executives at the defunct bank found to have participated in an illegal lending scheme involving some €450 million, the government is now pushing to establish a public inquiry that will examine just what happened in the lead-up to and on the night of the now infamous bank guarantee of 30 September, 2008.
In case you need reminding, the decision to issue a blanket guarantee worth some €440 billion has ended up costing Irish taxpayers €64 billion.
It has been the reason for a series of austerity budgets since 2008 and it is why Ireland was forced into an EU/IMF bailout in 2010 with debt repayments that will go on for decades.
It’s worth remembering there have already been a number of investigations into the collapse of the Irish banking system. These include the report of the current Central Bank governor Patrick Honohan, the Nyberg report and the Regling-Watson report.
But politicians want their turn at examining the issues and bringing politicians, civil servants and public officials before them in a public environment and forcing them to account for their actions.
“It will all be done before the court of public opinion and people will be able to judge these matters,” Minister Brendan Howlin said today.
The phrase ‘political show trial’ has been uttered more than once but before we can even focus on what might happen when these faces from the past come before an inquiry made up of politicians there are a couple of outstanding issues…
1. Who will sit on the inquiry committee?
We know that Labour’s Ciarán Lynch will chair the inquiry that will be carried out by a specially-established Oireachtas committee. But the identity of its other members is unclear. TDs as well as Senators will most likely be involved and the government will ensure it has a majority of its members on the committee.
Possible members include the vice chair of the Public Accounts Committee Kieran O’Donnell, indeed almost all members of the PAC are likely to be in with a chance of participating. The same would apply to those who sit on the Oireachtas Finance Committee. Coincidentally Lynch will almost certainly step down as chair of that committee once the inquiry gets up and running.
Opposition parties will be allowed to nominate who they want to sit on the committee but the final say rests with the Dáil’s Committee on Procedures and Privileges and ultimately the government. Fianna Fáil’s Michael McGrath is currently the most likely opposition politician to feature. The identities of Sinn Féin and independent members are unclear.
Obvious choices like Pearse Doherty and/or Shane Ross may be prevented from taking part due to their previous comments about the financial collapse and bankers. A government source has previously spoken of the need for “political savvy” over accounting and banking expertise.
All that said, accounting and banking expertise will be needed which is why the committee is expected to have dozens of support staff comprising of accountants, economists and experts on financial regulation. As well as some 48 staff it will be roughly allocated around €5 million in funding.
2. What will it examine and how far can it go?
The buzzword here is ‘scoping’. Before any public sessions can be held the inquiry is likely to spend a number of months scoping out the parameters of the inquiry and establishing terms of reference.
Essentially this is figuring out what exactly the committee is going to look at and who it’s going to call. The Taoiseach has previously said that the inquiry will focus on three main areas:
Lynch stressed today that he wants to ensure there is consultation and agreement with members, saying: ”I think my role as chair is not to come into this with a proscriptive position, but to get the views of all inquiry members.”
In doing this, it might be worthwhile if the committee considers a report already carried out by the PAC in July 2012 which examined the crisis in the domestic banking sector and provided a ‘framework for a banking inquiry’. The nearly 300-page report should be required reading for anyone involved in the special committee.
3. Avoiding legal difficulties
In establishing the terms of reference and examining the role of banks, the issue of Anglo may be a thorny one. While the convictions of Pat Whelan and William McAteer and the acquittal of Seán Fitzpatrick draw a line under the Maple 10/Quinn loans issue there are two other criminal trials involving the bank that are pending.
Were they to get under way this year it raises the possibility that the inquiry will be forced to stop or to avoid the Anglo issue altogether. There will be questions about the value of any inquiry that excludes Anglo – a situation that would be “nearly akin to Hamlet without the Prince” according to one senator.
4. Making sure they have all the documents and records
As we’ve reported extensively in recent months, the Department of Finance has lost letters concerning Bank of Ireland after the guarantee was issued and has been unable to find them despite an extensive search. This raises huge questions about the integrity of documents related to the guarantee.
The Department of Finance has started to document all the records it possesses and to cross reference these with other documents in that period with a view to ensuring the completeness and integrity of records from the period. It says that it is “not aware” of any other missing documents.
The Department has asked banks to preserve internal recordings of conversations and make them available to the banking inquiry in the wake of the emergence of the Anglo Tapes last year.
As well as this, the Taoiseach has consistently bemoaned the lack of records in his department which explain the rationale behind the guarantee decision. A schedule of records, obtained by Fianna Fáil, disputes this version of events and details a raft of records that are all currently restricted due to government confidentiality. Will the committee have access to these records?
5. Drawing up a witness list… and making sure witnesses attend
The witnesses are unlikely to appear any time soon but when they do they will be drawn from all spheres – political, civil service, Central Bank and people “in and around” the guarantee, as one source close to the inquiry said today. This will include officials from accountancy firms KPMG and Merrill Lynch, who provided key advice at the time.
The former financal regulator Patrick Neary (above), around whom huge questions have arisen after the Anglo trial, will almost certainly be called to attend. Former taoiseach Brian Cowen and his predecessor Bertie Ahern will also be asked to appear and have said that they will. Other notable and likely witnesses include former Department of Finance official Kevin Cardiff and serving and former executives at the country’s leading banks whose account of events was recently published by the Irish Times.
In assessing what witnesses to call the committee may face further legal issues. The recent Anglo case shone a light on the involvement of its former chief executive David Drumm. His US residency has made it impossible for gardaí to interview him and it’s almost certain that the committee will face the same problems.
The committee will have powers of compelability, akin to those enjoyed by the High Court, but it will hope that it won’t come to that and that the willingness of the many to attend will result in the few who are not being pressured into doing so.
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A waste of time and money….
This is Ireland its what we’re good at….
Ireland, a solicitors Ibiza
If anyone involved in this travesty owed Five Grand to a drug dealer they would be lying face down in a ditch. The fact is they owe the people of Ireland 64 Billion… And get to play GOLF.
There is only one issue that I am concerned about. Is there any chance that any sort of justice will come from this €5mil cost? Is this just another round of the seemingly endless game of ‘let’s all kid ourselves’.
Considering a 5 year investigation, a 47 day trial and 2 guilty verdicts didn’t result in a single night spent in a cell I really don’t see the point.
Look at all the tribunals. Costs hundreds of millions €.
Impact? Negligible
Benefits? Lawyers and journalists.
this is a corrupted rotten state there is no justice. It not even a question of poacher turned game keeper its poacher is the the game keeper.
We already had trials found guilty but no punishment not even a fine.
French revolution is needed ” off with their heads “
It will take a few months to set up and will focus on FF role on the banking collapse just in time for the next election so Enda ensures he is the first two term back to back FG Taoiseach! Or am I being too cynical
Was listening to Enda spouting today sadly Wayne Enda is to much of self-interested politician to not ensure it is all about FF. Which is a pity….
First item on the agenda should be a huge round of lengthy imprisonments.
Unfortunately I seriously doubt that is even on the agenda
Eh, considering being found guilty in court doesn’t get these crooks a custodial sentence, why would an inquiry lead to imprisonments?
Never said anything about a trial.
Enquire, listen, imprison.
Simple!!
You need a trial to imprison people. Anyway, if the courts won’t imprison these people what on earth would make anyone think the politicians would?
Folks
Don’t get your hopes up. This is nothing than a politically motivated charade.
If the govt wanted a real enquiry into the events of 2008 specifically and also the years leading up to it then they would have set this up day 1 in office.
This is designed to have maximum impact for the next general election.
Two events happened this week to back this up:
1. Banking enquiry – Prefectly timed that hearings will probably have just started when the election is called.
No firm report or interim report at that stage just lots of commentary
2. Adams arrested – (as you will know I am not his biggest fan) again the evidence had been bandied about for years.
However, SF are getting uncomfortably big. People have seen the demise of the SDLP. Parties on both sides of the border are worried.
And I’d suggest there is tacit approval from the southern leadership of SF. They buy into it because Adams is a blocker to advancement here in the Republic.
My overall point: it is all politically motivated.
Why not bring in people from the states or any other country that has experience investigating white coller crime. I’m sure the FBI would have retired agents well equipped to investigate. This getting politicians with no expertise in banking or law is a joke. The bankers and politicians are too closely linked.
Linked is understatement
Why did those sc&mbags not get jail ? The old boys club in action again ?
Because the offences they were found guilty of, and the circumstances around the committing of those actual offences, did not warrant a custodial sentence.
You can only jail someone for what they have been found guilty of.
That would be in the judges opinion Bob and they were found guilty of the offences by 12 of their peers.
What’s your point Kerry?
Judges decide sentences. It’s their job.
As regards opinion, I’ve yet to hear any journalist who attended the trial disagree with the sentence. People have a right to be angry but you can only sentence people on the actual crime.
Is that the crime they where found guilty of ?
The regulator should havr been next in court but why bother he just gave them the nod to break the law.
“To the best of my recollection”
“Too ill to attend”
“Letter cannot be found”
“Person who had the pertinent information is deceased”
Anyone expecting anything else?
” I don’t remember” , ” I can’t recall” , “I’m not exactly sure about that” and “are those my feet?”…
I lost it on de horses!
see how many barristers become millionaires giving free legal advice to politicians who may end in high court
non if there giving FREE legal advice.
It be given free but taxpayer will pick up the tab
This entire charade is an an attempt to have the so called issues paraded across the front pages in the period leading up to the next election.
It is clear from the comments of Howlin and Kenny that what they want is a Star Chamber style political show trial and not the truth. We all know that Bertie and Biffo created the economic environment that lead to the crisis and we know exactly how the Banks got into the mess that they did get into. We also know the action taken, rightly or wrongly, by Brian Lenihan and the Central Bank to avoid a Banking collapse.
All that is left is an examination of the advice given to Brian Lenihan and the then Government.
Why does this need a Parliamentary enquiry?
Kind of makes one relieved that we voted against giving these committes more power
Lol
We live in a crazy country where the LAW is an ASS!
A bank gives over €400 million in illegal loans contrary to Section 60 of The Companies Act yet nobody is held liable!
What kind of legal system do we have?
The Government will now establish a Tribunal to find out the facts! Yet nobody will go to prison!
No wonder people have lost all faith in politicians!
We live in a country where innocent Taxpayers are deemed liable for the debts of developers, builders and bankers and politicians who made a mess of Ireland – yet these people draw big salaries, are on big pensions and get big bonuses!
NAMA even pays salaries to some of theses guys!
The so called Regulator got a big tax free lump sum and big pension yet he did not do his job!
Ireland is the laugh ting stock of Europe and the World -we bailed out the unsecured German Bank Bondholders and our Government transferred the debts to all Irish Taxpayers!
How unjust can we be!
“Obvious choices like Pearse Doherty and/or Shane Ross may be prevented from taking part due to their previous comments about the financial collapse and bankers.”
The only understanding I can derive from that sentence is – “we know you’re disgusted at the behaviour, so we’d rather not be justifiably berated and embarrassed in public”.
I wonder will 7 Gardai be called to remove Shane Ross if he shows up asking real questions…….
Because Shane Ross was a coat holder for Anglo through the pages of the Indo.
Not even the appearance of “justice”. Not even the appearance.
But the Enda is concerned about “welfare dependency”.
Thatcher lives.
I’m very sceptical that we will find out anything worthwhile. The narrative around the Guarantee has been written and agreed.
What more could they hope to uncover?
We know:
Who lent money recklessly
Who borrowed money recklessly
That the State supervisory role utterly failed to do its job
Jesus haven’t they wasted enough of the tax payers money no one will be done for this because they will always look after themselves but I’m sure they will fine enough people for TV and water to pay for it Filth that’s all they are
It has taken too long (and too many excuses) to get this started. Deciding the parameters should not take half a year (or however long it will take). A couple if months within a well organised, intelligent group (I know – this is one of the problems!) should have this done in a couple of months – that’s with legal checks. A time limit set of less than 6 months to run through everything and force the feckers involved to attend and a financial limit imposed on how much the lawyers and consultants make out of this. Most importantly however, proper enforcement of punishment to anyone found guilty of destroying this country in any way. No more Mahon tribunal crap of well we know they were wrong on many levels but we have no power to do anything to them and will continue rewarding them with a better pension than most people’s salary.
Of course I realise this is sadly a fantasy – this is a ploy to get us thinking they care before elections and after fortunes more spent no justice will be done.
The Fighting Irish :):):)
They will blame the dead guy??
We know it will be thorough. A thorough whitewash.
Wat is the point.. Not a day in prison so y waste taxpayers money.. The real criminals r in the Dail.. Wat a shower..
The only thing that the bank enquiry will prove will be that you can get away with shafting the public
Hasn’t enough money been wasted already ? It’s not as if this bank enquiry is going to lead to any of the guilty parties being punished . The main players have already sailed off into the sunset with pensions and personal fortunes Intact ! This nonsense is just adding insult to injury .. F.G. just want all the slimey details back in the public domain in time for the next general election !
We know in the recent trial some facts, that the share support scheme was illegal, we know that the regulator helped the Anglo executives in their scheme. We know that everybody did not know it was illegal, so there is no responsibility.
Simply put there is no political will to prosecute senior civil servants who helped in this illegal share support scheme.
Is this the ultimate in group think We are the state we can do no wrong. Or just insiders do not need to answer to the law.
We do not need another inquiry, it will be just a smoke screen to deflect and delay.
Here we have a bunch of parasites investigating their buddies and relatives. The trial of Anglo was a farce and this is just a nice earner for the legal profession……The 1 % of haves are now really taking the urine milking a dead cow. Do they really believe that the people of this country are so stupid?
What a waste of time everyone who has the slightest interest already knows what happened and also knows that this bs will not punish anyone so what’s the point except jobs for the boys
As in ALL Irish Enquiry’s or kangaroo courts…..Lets give mr greedy bags widow a wad of cash to ask her can we use him as a scapegoat, we love to blame the dead guy….. !!!!!!!
Inquiry conclusion: ecb banking rules, to whom irish central bank reports, were and still are very relaxed allowing banks to overleverage (take high risk). Same rules permit a mixing of risky investment banking business with high street banking by banks previously outlawed but thanks to the usa (bill Clinton 1999) these protections were repealed. The result: large international banks gave anglo too much money. In engineering terms you could say that banking is like a car without a speedometer. Nothing has changed, we are still exposed to dodgy financial products eg. Cfd’s, cds’ s, all variety of assed backed
securities -cdo’s, and re mortgaging by banks. even without sean quinn anglo was over leveraged and going to go bust anyway. Once lehmann fell others were set to follow and vulture capitalists saw an opportunity to buy assets at knock down prices and earn an amazing return on irosh govt bonds even though these were guaranteed
And the Irish Tax payer will foot the bill…………so lets have a big slap up party to conclude this.
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