Siobhan Creaton: Fingers left rattled by his 'personal bank' skeleton
Michael Fingleton behind the wheel of his car in Blackrock, Dublin, earlier this year. Photo: Steve Humphreys
MICHAEL Fingleton hasn't mellowed or been in any way humbled by the destruction of Irish Nationwide. The disgraced banker showed his true colours at the Employment Appeals Tribunal attacking his accusers and absolving himself of his sins. It was a virtuoso 'Fingers' performance. The fiasco that has cost Irish taxpayers €5.4bn has nothing to do with him.
The man who ran the now defunct Irish Nationwide building society with an iron grip for 40 years was outraged to be accused of running the place like a "personal bank". That kind of talk was "slander" he bellowed, "absolutely not".
It is interesting that his outburst came on the same day the UK Financial Services Authority (FSA) published its report into what went wrong at the Royal Bank of Scotland, which owns Ulster Bank here. Its reckless lending spree cost British taxpayers £45.5bn (€54bn) to rescue and it lays much of the blame for what happened with that bank's chief Fred Goodwin's "assertive and robust management style" and the regulator's failure to tackle it.
As far back as 2003, some of its supervisors highlighted what they described as "chief executive dominance" referring to Mr Goodwin's forceful exchanges with the bank's then chairman, George Mathewson. This is always a worrying sign, because a bank chairman is there to protect its shareholders and to hold the men running the bank on their behalf to account. But Mr Goodwin appeared to be the stronger of the two characters, the supervisors observed. In hindsight, the FSA says, this should have been enough to prompt its most senior executives to review how the bank was being run, but that never happened. It proved a costly mistake.
Around the same time, a new regulatory body was getting into its stride in Ireland. The brainchild of former finance minister Charlie McCreevy and former Tanaiste Mary Harney, the Irish Financial Regulatory Supervision Authority was hived off from the main Central Bank and set up in 2003 to mainly protect consumers. Its first chairman, Brian Patterson and chief executive Liam O'Reilly, held a press conference to set out their grand plans; they would take on the banks and building societies and quickly make things better for their customers. It didn't take long for journalists to ask what they were going to do about Irish Nationwide.
The controversial building society and its truculent chief executive were constantly in the news for all the wrong reasons. It was the financial institution that had been forced to pay over €4m in back tax owed to the Exchequer; Judge Peter Kelly had threatened to jail its boss during a wrongful dismissal case and over at the Flood Tribunal, Mr Fingleton was chastised for his "cavalier" attitude to providing it with information. It was the building society that forced a widow with four children to fight it through the courts for nine years to save their family home, even though it was Irish Nationwide's fault that a mortgage protection policy wasn't in place when her husband died.
It was the small building society that was technically owned by the thousands of customers who had mortgage and savings accounts, yet for years they had no idea how much Mr Fingleton was paying himself. He refused to talk about his pay packet or much else really. He didn't have to. At an annual general meeting in 2003 a customer asked him why Irish Nationwide got such a bad press.
"You have to understand that things ain't what they seem to be," he explained. "There are no skeletons here. Absolutely none. Don't believe everything you read in the papers," he told them. There were lots of red flags being waved about Irish Nationwide then and for many years after, just as they were at Royal Bank of Scotland -- yet their powerful bosses were allowed to carry on regardless. No one stood up to them.
Of course, we now know the full extent of what Mr Fingleton was really up to. Every year, he helped Sean FitzPatrick to hide the millions worth of loans he was taking out of Anglo Irish Bank from its shareholders.
He took the small building society into commercial property and lost a fortune, and whether he believes it or not treated the place like his own private bank.
His sense of entitlement lasted long after he was finally ousted. There was the €48,000 he claimed in fees for the K Club, the €12,000 for dental work at the Blackrock Clinic and a stay at a London five-star hotel. He has never returned the €1m bonus he received in 2009 or the watch he was presented with and appears immune to all pressure to return them.
Mr Goodwin's troubles with the FSA appear to be over now the report has been published.
IT will not be initiating any criminal prosecutions or even slapping a big fine on him. Reports claim his lawyers worked tirelessly to water down the report, arguing for words like "gambling" to be removed, much to the annoyance of Royal Bank of Scotland shareholders who have lost everything. They still hope to drag Mr Goodwin through the courts but face a huge battle.
In the meantime, Mr Fingleton will continue to blast anyone who accuses him of doing anything wrong. This is how he kept the regulators at bay for so many decades and is the only defence he knows.
- Siobhan Creaton
Irish Independent
