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Friday 19 September 2014

Noonan sanctioned decision to drop case against former Nationwide director

Daniel McConnell Political Correspondent

Published 24/04/2014 | 02:30

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Finance Minister Michael Noonan. Photo: Frank Mc Grath
Finance Minister Michael Noonan. Photo: Frank Mc Grath

FINANCE Minister Michael Noonan personally sanctioned the dropping of a civil legal case by the former Irish Nationwide Building Society (INBS) against ex-director Con Power.

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Dr Power, a former non-executive director at the failed Irish Nationwide, "had been party to proceedings" taken by the liquidated IBRC against former directors over their role in the INBS's demise.

The admission by Mr Noonan that he was directly involved in the decision to drop the case against Dr Power is highly unusual and in stark contrast to his normal position of not interfering in the commercial activities of the IBRC.

It represents the first known intervention of this sort by Mr Noonan. The revelation last night brought a scathing response from Fianna Fail's finance spokesman Michael McGrath who said Mr Noonan's involvement was "wholly inappropriate".

Dr Power was initially named by government-appointed liquidators KPMG among the individuals against whom the IBRC was taking action.

Former Nationwide chief executive Michael Fingleton is one of those still facing a legal challenge.

This case is seeking damages from Mr Fingleton in relation to his stewardship of the building society, whose collapse cost the taxpayer €5.4bn.

The case against Mr Fingleton is likely to focus on how INBS gave a loan of €29.3m to buy a site in Dublin, in 2007, without first getting board and credit committee approval and without carrying out other necessary steps as set out in its commercial lending policy.

With regard to Dr Power, who served as a director from March 2000 to 2006, it has been confirmed that following consultations between the minister and the then IBRC board, a decision to "discontinue" the case against him was taken.

Once Anglo Irish Bank and Irish Nationwide were nationalised and joined to become the IBRC, the Finance Minister became its only shareholder.

The revelation was made in reply to a Dail question from Sinn Fein's finance spokesman Pearse Doherty.

Mr Noonan said: "Dr Power had been a party to the proceedings against the former directors of INBS.

"However, following further review and legal advice, it was decided by the then board of Irish Bank Resolution Corporation, in consultation with me, to discontinue the action against Dr Power."

Mr Noonan added that since that decision was taken, the liquidators have "not revisted" the issue. "As the proceedings in question are before the High Court it would not be appropriate for me to comment further on this matter," Mr Noonan said.

Irish Independent

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