Banker fired over $60m loan letter to firm wants job back
Published 13/07/2014 | 02:30
A BANK manager who was fired after he wrote a letter sanctioning a $60m (€45m) loan in principle to a company of which he was joint owner is demanding to be re-instated. Declan Maher, from Clifden, Co Galway, was dismissed as an AIB branch manager in 2011 after it emerged he wrote a letter to BMB Partnership, of which he was a 50pc shareholder, in April 2005 stating the bank was “agreeable in principle” to advance $60m to the company to purchase 100 villas in Florida.
An Employment Appeals Tribunal last week heard that none of Mr Maher’s superiors within the bank were aware of the letter, despite the fact that Mr Maher was only permitted to sanction loans up to €160,000.
Mr Maher denied that the letter amounted to a loan sanction in principle (SIP), insisting that it was a marketing letter to attract new businesses to the bank, which he sent to his accountant Kevin Barry, with whom he was joint owner of BMB Partnership.
While he accepted that as joint owner he had effectively written the letter to himself, he added that “nobody in their right minds” would view it as an SIP letter. He told the tribunal that during the Celtic Tiger years managers had been under pressure to chase business and that this is what he had been doing.
However, counsel for AIB Tom Mallon said the letter was “replete with lies”, leading to the belief that it was written for an “ulterior motive”. He said the very subject and first line of the letter which referred to a recent application, suggested a loan application had already been made when this was not the case. No loan was ever made or issued in the matter.
In the letter dated April 21, 2005, Mr Maher wrote: “I refer to your recent application, on behalf of BMB Partnership to borrow $60m to complete the purchase of 100 villas (known as Gables on the Green) in Orlando, Florida. I understand that these monies will not be required until the villas are fully completed, which date is estimated to be in approximately 12 months. Based on the data submitted, I can confirm we are agreeable in principle to advance these funds to your group, subject to the following . . .” The letter went on to include five detailed conditions.
However, an internal investigation into the matter could find no paper trail for any loan application or data submitted by BMB Partnership. It found there had been no application or due diligence prior to the letter being sent by Mr Maher to the company.
However, Mr Maher denied that the letter amounted to a loan sanction in principle, insisting it was a marketing letter to attract new businesses to the bank.
After four separate stages of a disciplinary process, during which Mr Maher was on special paid leave, his position was terminated in 2011 for gross misconduct.
The former manager said the dismissal from his job worth close to €100,000 a year left him devastated. Mr Maher, who currently runs the Alcock and Brown hotel in Clifden, which he co-owns with his wife, told the tribunal that as a result of the job loss he and his family faced a “very bleak future”.
He said that while returning to the bank may not be the best solution, it was the only one open to him.
“The truth of the matter is I can’t get any job out there at this time that would pay me the salary I had in banking and in banking I am not going to get another job,” he added.
He called on the tribunal to re-instate him to his post, pay his salary from the date of his dismissal and fully re-instate his pension. He also requested that the bank offer him the option to take up one of the various early retirement options opened to management and staff since his dismissal. Mr Mallon said the bank no longer had trust or confidence in Mr Maher and reinstatement would be entirely inappropriate.
The tribunal said it would make a ruling after reviewing the lengthy documentation in the case.