ACC could face garda probe over allegations of forgery
DPP asked to investigate documents issued by bank relating to €3.2m loan
Published 13/02/2010 | 05:00
ACC Bank could find itself at the centre of a garda probe after allegations signatures were forged on documents relating to a €3.2m loan.
Two officials have left the bank after the lender's internal audit team probed allegations of forgeries and other matters.
Mr Justice Peter Kelly, the head of Ireland's fast-track Commercial Court, yesterday asked the Director of Public Prosecutions (DPP) to investigate documents issued by the lender including a "fictitious" P60 in the bank's files certifying a much higher rate of pay for a retired garda, one of four people to whom the loan was made.
The potential criminal investigation into ACC comes as hundreds of investors who are unhappy with the performance of an investment product sold to them by the lender in 2004 are planning to issue High Court proceedings.
Mr Justice Kelly made his comments during a case in which ACC secured judgment for €3.27m against two couples. They are retired garda George McGrath and his wife, Catherine, of Srah Cross, Loughrea, Galway, and George and Evelyn Fahey, Rakerin, Gort, Galway, arising from a loan of €3.2m made to them in 2006.
Mr McGrath has extensive property interests and he and Mr Fahey were assessed by ACC in January 2008 as having a net worth of some €25.86m.
Mr Justice Kelly said that given the "disturbing evidence", he was referring the papers in the case to the DPP.
ACC said a handwriting expert had concluded signatures on a loan document were not those of the four defendants, the judge was told.
The judge said the bank initially sought judgment, plus interest and costs, for some €4.5m against the four, but had reduced that claim to €3.27m.
As the defendants accepted they got the money, the bank was entitled to judgment in that smaller sum, he said.
ACC was quite right to reduce its claim, but its reasons why raised "a number of troubling issues", he said.
These included questions over a P60 for Mr McGrath for the year ended December 31, 2005, correctly showing total pay of €24,951 when he was working half-time as a garda.
However, data provided by ACC to Mr McGrath under the Data Protection Act showed ACC held a purported P60 for the same year falsely certifying his earnings at €89,952.
Mr McGrath had sworn he had no part in creating or procuring that document.
Mr McGrath (53) served 30 years in the garda before retiring three years ago on pension, the judge noted. He was the only defendant to give evidence and the conduit through which ACC transmitted information to the other defendants.
By October 2008, Mr McGrath owned 25 properties valued at €6.5m and was involved in several partnerships, including two with Mr Fahey, which had property portfolios valued at €12.2m and €26.1m, the judge said.
ACC had said its decision to loan money to Mr McGrath was based on his net worth, not his earnings as a garda, the judge said. It was still of concern the bank was in possession of "a fictitious P60".
The ACC loan was given to buy a property in Loughrea and a letter of loan sanction was given to the defendants in May 2006. It was signed by Aidan Corcoran, a relationship manager, and Pat O'Callaghan, a senior manager, at ACC's Galway financial services centre.
Some inaccuracies were discovered and a new letter was issued and purportedly signed by the defendants and witnessed by Mr Corcoran.
The defendants received the €3.27m, but failed to pay interest due from August 2008, and in March 2009 ACC demanded repayment of all monies and then took legal proceedings.
All four defendants had sworn they had not signed the loan sanction letter or seen it until the legal action and Mr Corcoran denied witnessing the second letter.
The case was adjourned to next week to allow the defendants consider whether to seek a stay on judgment.