Saturday 19 April 2014

NAMA executives deny 'loan undervaluation' allegations at PAC

Nama bosses Brendan McDonagh and Frank Daly

NAMA has denied a series of serious allegations made to gardai by one of its former portfolio managers.

Speaking at the Dail's Public Accounts Committee, NAMA chief executive Brendan McDonagh denied sensitive information relating to developer Paddy McKillen was leaked to third parties.

He has also rejected allegations, made to gardai by former portfolio manager Enda Farrell, that loans were deliberately undervalued by the agency.

"In relation to allegations of which it has become aware, NAMA is satisfied that they are unfounded," said Mr McDonagh.

"If they are submitted to us formally and in sufficient detail, I assure the committee that we will deal with them individually and robustly."

The NAMA chief executive claimed the agency was the victim of "a carefully orchestrated operation targeted at a small number of media outlets and Oireachtas members".

"Its intended purpose is clear - to damage NAMA and thereby undermine the financial institutions of the State," he said.

"Presumably, if enough mud is thrown, some of it will stick," he added.

Earlier this week the Irish Independent revealed Mr Farrell's allegation that he had passed confidential information to a third party, specifically highly sensitive material relating to Mr McKillen's private and business affairs.

Mr Farrell handed a dossier to gardai containing emails and other correspondence which he claims proves leaking was rife within the secretive agency.

He also alleges he was encouraged to deliberately undervalue property loans.

The Garda Bureau of Fraud Investigation has submitted a file to the DPP recommending that Mr Farrell be charged with leaking sensitive commercial data to outside companies.



Mr McDonagh said some of the allegations "appear to to be the personal views of Mr Farrell on various organisational matters on which he would not have a complete perspective nor could he be expected to have, given the position he held."

He said Mr Farrell's claim he provided a "full file" relating to Mr McKillen to a third party "directly contradicts his previous sworn statements".

NAMA had, over the past 36 hours, requested its own internal auditors review all emails between Mr Farrell and the third party.

"There is no evidence from the search to date that any information relating to Mr McKillen was transmitted electronically," he said.

The NAMA chief executive also said the agency had held "very little information" about Mr McKillen.

"Financial information would ordinarily be expected to include sworn statements of affairs, lists of unencumbered assets, borrowings with non-NAMA institutions and so on," said Mr McDonagh.

"NAMA has never possessed this information in relation to Mr McKillen."

Mr McDonagh confirmed the allegations that a second former employee leaked "a single document" was referred to gardai in February.

He said there was no link between this case and that of Mr Farrell.

On the property undervaluation allegations, Mr McDonagh said that at no stage did NAMA itself determine property valuations.

These were done by the banks and independent valuers.

"The process was subject to extensive auditing, including audits by KPMG," he said.

"The process was also audited thoroughly by Ernst & Young and PwC."

Mr McDonagh said any suggestion that the NAMA valuation process resulted in systematic undervaluation had been "thoroughly disproved" it had a €3.6bn impairment on its loans.

He added: "NAMA is involved in a very difficult business with a lot at stake, both for the taxpayer and for others.

"In seeking to do its job professionally, it inevitably finds itself in dispute with various parties. Some of those will inevitably seek to intimidate or discredit NAMA for their own purposes."

NAMA chairman Frank Daly told the committee claimed the agency was the victim of a campaign to undermine it.

"NAMA will not be intimidated, influenced or distracted by the efforts of whoever may be behind it," he said.

Shane Phelan, Public Affairs Editor





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