Irish Republican News · February 13, 2009
[Irish Republican News]

[Irish Republican News]
IRISH REPUBLICAN NEWS: Banks: The seven billion Euro run-around
Banks: The seven billion Euro run-around
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The scandal over the dodgy dealings of Ireland’s top bankers took another turn this week when it emerged that vast sums of money were shuffled between institutions last year in order to conceal grave financial difficulties.

The controversy has threatened to overwhelm Dublin’s Finance Minister Brian Lenihan as he struggles to keep the Irish financial sector afloat. The Minister, whose competence is questioned in the Dail on a daily basis, faced calls to resign after he admitted that he had not read an auditor’s report on dealings at Anglo-Irish Bank, which he nationalised last month.

The report contained warnings over a sum of seven billion Euro which was moved to Irish Life and Permanent, and back to Anglo-Irish Bank hours before the bank’s accounts were to be tallied at the end of its financial year. The massive but fleeting deposit, presented as a valuable “customer deposit” on September 30, served to disguise the huge hole in which the bank found itself.

It also emerged that Minister Lenihan only learned about the seven billion transfer last month, even though his department had informed the Financial Regulator about the issue last October.

Anger is growing at the state’s expensive decision to take control of Anglo-Irish Bank amid concern remains that other fraudulent or corrupt transactions remain concealed. Moreover, the scandal around the bank threatens to bring down the entire Irish banking sector, despite the state’s two largest banks being the beneficiary of a seven billion Euro cash injection from the state this week.

Earlier this year, Anglo’s chief Sean Fitzpatrick and other directors were forced to resign in disgrace after it emerged that they had run up debts of over a hundred million Euro, loans which were also concealed from the bank’s balance sheet. The then Financial Regulator, Pat Neary, was also forced to quit.

But it is the seven-figure salaries and bonuses which bank chiefs continue to amass, amid the carnage in Ireland’s financial sector and the deepening national recession, which is provoking the greatest public anger at the moment.

In an extraordinary television interview, Bank of Ireland chief executive Brian Goggin accepted that “mistakes” over lending practices had brought his institution to the verge of bankruptcy, but incredibly complained that his earnings this year would be “less than two million”, which was “substantially down” on his “disclosed total compensation” of 2.9 million Euro last year.

A meeting of the board of Irish Life & Permanent is continuing this Thursday night as the company’s directors and senior management consider calls to resign over their potentially fraudulent involvement with Anglo.

Earlier this evening, Minister Lenihan said that he expected the board of Irish Life & Permanent to “live up to their face up to its responsibilities”, signalling that the bank’s chief executive, Denis Casey, should go.

The leader of the Green Party, John Gormley, made a general call for corporate criminals to be “led out in handcuffs” as happened in the US.

Sinn Fein Finance Spokesperson Arthur Morgan said Minister Lenihan should consider his own position, “having failed to notice the activity of Anlgo Irish in cooking their books”.

“Surely an activity which was done to deceive people over Anglo’s loan books should have been noticed. At the time of the nationalisation the Minister had a duty to disclose this information to the public and the Dail about these types of transactions.

“Anglo Irish is Ireland’s Enron. This is a poisoned bank and should not have been bailed out by the Government at the tax-payers’ expense.”

© 2009 Irish Republican News