Friday 20 October 2017

Call for crisis meeting over credit union rescue fund

Martin Sisk, president, Irish League of Credit Unions
Martin Sisk, president, Irish League of Credit Unions
Charlie Weston

Charlie Weston

Moves are to be made at this weekend's annual meeting of the Irish League of Credit Unions to have normal business suspended to discuss stark revelations about how a multi-million euro rescue fund is run.

And a Government backbench TD is to seek to have the damning report into the league's Savings Protection Scheme (SPS) fund discussed at the Public Accounts Committee.

Fine Gael TD Paul Connaughton will ask his fellow committee members to agree to have elected officials in the credit union league, and the representatives from the Central Bank, called before the committee to explain major flaws in how the savings protection fund is operated.

The Irish Independent revealed this week that a secret report by accountancy experts Mazars found a catalogue of mismanagement, breaches of rules and poor oversight in the way the league-owned SPS fund is operated.

Guaranteed

Some €85m has been guaranteed to 48 credit unions since the SPS was set up 26 years ago, with €61m of this was handed out in the past two years.

This Saturday and Sunday some 1,200 delegates from 350 credit unions are set to attend the annual general meeting of the league, which is a representative body for the sector.

A number of long-standing league members are to seek a suspension of standing orders to have concerns around the governance of the SPS discussed.

Some €13m of credit union money was put at risk because of the way the SPS rescue funds were used, Mazars concluded.

And there are also concerns that a large number of key posts in the league remained unfilled. These include chief executive, head of legal services, head of monitoring and head of IT.

Fianna Fáil finance spokesman Michael McGrath said credit unions have massive potential, but the sector "needs strong corporate governance practices to underpin this".

"While it has made significant improvements in recent years in this regard, the issues that have been raised in relation to the savings protection scheme are of grave concern," he added.

The Irish League of Credit Unions has refused to comment on the damaging findings on its savings protection fund, citing the "confidential" nature of its operation.

However, in a memo sent to all league credit unions yesterday president Martin Sisk and acting chief executive Ed Farrell insisted the savings protection fund was managed at all times with the utmost probity and adherence to all legal and financial requirements.

The memo added that the board of the league had not had time yet to consider the findings of the Mazars report, which they stressed was a draft.

Irish Independent

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