Irish Life & Permanent may get ‘substantial fines’ on Anglo scandal
Irish Life said in February it had made 'wrong' deposits with Anglo Irish Bank. Photo: Bloomberg News
Tuesday November 24 2009
Irish Life & Permanent said it may face lawsuits and fines stemming from its role in a scandal which claimed the top three executives at the mortgage provider.
The Financial Services Regulatory Authority is probing the company after Irish Life said in February it had made “wrong” deposits with Anglo Irish Bank, which is also being investigated.
“Depending on the outcome of any investigations, enforcement authorities may seek to impose substantial fines and penalties,” Irish Life said in a prospectus today, detailing plans to set up a new holding company.
The episode hurt the reputation of Ireland’s financial system, as it struggled to survive the global credit crisis. Irish Life Chief Executive Officer Denis Casey resigned after transactions that Finance Minister Brian Lenihan said may have created a “false impression” about Anglo’s strength.
“In a prospectus, it’s prudent to include all risk factors, hypothetical or not,” spokesman Ray Gordon said today. “We are not speculating on whether fines will be imposed or how much they might be if they are imposed.”
On September 30 2008, the last day of Anglo’s fiscal year, Irish Life deposited €4bn overnight with Anglo. That transfer was made after Anglo deposited the same amount “as collateral” with Irish Life, the company said.
Former Finance Director Peter Fitzpatrick and treasury head David Gantly also quit Irish Life after the controversy.
Irish Life rose 3.2pc to €3.50 as of 12:20pm in Dublin trading, giving the company a market value of €943m.
- Ian Guider and Louisa Fahy
© Bloomberg
