Cowen: law will deal with rogue banks
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TAOISEACH Brian Cowen has said for the first time that rogue bankers will face justice for bringing Ireland’s financial system to near ruin and into international disrepute.
It’s the strongest signal yet that the Government is seeking criminal prosecutions that could put some of Ireland’s most senior bankers in jail.
“Where there is any wrong doing proven as a result of an investigation it has to be dealt with. Dealt with by the appropriate authorities, in the appropriate way and in accordance with the law,” Mr Cowen told the Sunday Independent.
In the latest Sunday Independent Quantum Research Poll, 99 per cent of those questioned said the disgraced Anglo Chairman Sean Fitz- Patrick should face a full investigation by the Fraud Squad in relation to his activities at Anglo Irish Bank.
The Irish banking sector is now facing criminal or corporate enforcement investigation on at least three fronts.
Firstly, the Director of Corporate Enforcement, Paul Applelby, has said that the cover-up by Anglo Irish Bank of former chief executive Sean FitzPatrick’s loans may have been illegal.
Secondly, the Garda Commissioner, Fachtna Murphy, has sought further details relating to a demand from Fine Gael that the Anglo Irish Bank debacle be referred to the Fraud Squad — the first official complaint received by the gardai about the failed developers’ bank.
Thirdly, the Green Party is now insisting that tough new laws be introduced to beef up the powers of the Financial Regulator and the Office of Corporate Enforcement.
“Now is the time when we change the nature of corporate responsibility in Ireland. We cannot wait.”
Mr Cowen has also admitted that the State failed to keep the banking sector under scrutiny in the past and reform of the system of regulation is now the top priority for Government as it tries to restore the country’s discredited banking system.
He told the Sunday Independent: “The job we have to do is improve the regulatory system, because it clearly hasn’t been working sufficiently to inspire public confidence in recent times — so that where there is any wrong doing, we can identify it and deal with.”
And in a tacit admission that Ireland’s standing in the international financial community has been severely damaged, Mr Cowen declared:
“We must improve the regulatory system in Ireland so that people can see that that it works properly. Not only people at home, but people abroad.”
The Department of Finance is now involved in fast tracking new legislation designed to give the State greater powers of scrutiny about what goes on in Irish banks.
The international consultancy firm Mazars is assisting in the drafting of a new regulation framework to ensure that the State will have greater control and knowledge of key issues including credit growth, risk exposures and management, liquidity and corporate governance.
Under the tough new regime, banks will have to:
? Supply compliance certificates prepared by their external auditors every three months.
? Submit to new reporting arrangements designed to provide greater accountability.
? Directly engage with the Financial Regulator in a more rigorous manner than in the past.
Speaking to the Sunday Independent, Mr Cowen said reform was now a matter of top priority for Government.
He said: “We must improve the regulatory system in Ireland so that people can see that it works properly. Not only people at home, but people aboard.
“Because the impact of these issues on our reputation is not helpful in the context of trying to maintain stability in our financial system domestically at the moment.
That is what the principles of accountability are about.”
Elsewhere, the Garda Commissioner, Fachtna Murphy, has written to Fine Gael Justice spokesman Charles Flanagan seeking further specific details about an official complaint about how Anglo Irish Bank was run.
Yesterday, Mr Flanagan said, in response to the Commissioner, he was making a specific complaint to the Garda Fraud Squad about Anglo, relating to breaches under the Companies Act and under Section 10 of the Criminal Justice Theft and Fraud Offences Act of 2001, which deals with false accounting.
“That section of the Act states ‘a person is guilty of an offence if he or she dishonestly with the intention of making a gain for himself or another, or of causing a loss to another, destroys, defaces, conceals or falsifies any account or any document made or required for accounting purposes’,” Mr Flanagan added.
According to our latest nationwide poll, the country is clearly in no mood to forgive Sean FitzPatrick or the others responsible for the banking scandal.
In addition to the virtually unanimous verdict that Mr FitzPatrick should be investigated, 97 per cent of those polled think senior banking personnel who have indulged in reckless behaviour should be fired.
That compares with 84 per cent when we last posed the question three months ago.
“FitzPatrick symbolises everything that was wrong with the so-called ‘Celtic Tiger’; arrogant, greedy and on the back of it corrupt,” said one female respondent.
Ninety-four per cent of those polled also feel that those bankers found to have acted irresponsibly should also be deprived of so-called golden handshakes, up slightly since the question was last posed.
According to the nationwide poll, which was conducted on Friday night, the majority of people in Ireland now also want Finance Minister Brian Lenihan to resign.
Fifty-six per cent of those polled feel that Mr Lenihan no longer commands the necessary authority to remain in his position.
This compares to our poll three weeks ago, when only 39 per cent felt he should resign. “He has to go, he is doing more damage than good. He never had the background for the job in the first place,” said one respondent.
