News John Downing

Wednesday 17 September 2014

The public spotlight must always be on world's biggest property firm

Published 21/12/2013 | 02:30

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Developer Paddy McKillen
Developer Paddy McKillen

"Quis custodiet ipsos custodies?"

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THE well-worn Latin phrase is best translated as 'Who watches the watchmen?' But for our purposes today you might try: 'So who NAMAs over NAMA?'

The dilemma is as old as time. Setting up an organisation to supervise the handling of a tricky matter in the public good involves giving a whole wodge of trust to key people in that organisation.

It also carries an inbuilt fear: what if some of them betray the public good? And how will we know they are keeping faith -- especially when the work requires a high level of confidentiality?

Against this background, Frank Daly the NAMA chairman, and Brendan McDonagh, the NAMA chief executive, arrived at Leinster House yesterday to attend a meeting with the watchdog Committee of Public Accounts, which they had sought.

NAMA is rated the world's biggest property firm, managing assets that in theory are valued at about €72bn.

We expected a strong defence to very disturbing allegations which had been round about for all of this week and which were many times raised in the Dail and Seanad.

In the event both men decided to rely on the old maxim that the best form of defence is attack. In a tour-de-force double-act, both men utterly rejected these allegations and implicitly and explicitly tore into the people understood to be behind the claims.

NAMA could not have leaked a whole dossier of information about the affairs of Belfast businessman, Paddy McKillen, for several reasons.

NAMA did not have much information about McKillen, since the board decided in July 2011 not to acquire his loans. Computer technicians had done an analysis of email traffic from former NAMA employee, Enda Farrell, who is himself the subject of a garda investigation.

This email analysis apparently showed Farrell could not have emailed the information concerned to a third party as he himself had claimed.

Allegations of NAMA deliberately undervaluing loans were also untrue as there was a complex valuation, which involved potentially three valuers, one of whom was independent, and available to resolve disputes.

For the NAMA chief executive, Brendan McDonagh, there was only one conclusion to be drawn and he appeared to have weighed every word as he spelt this out.

"NAMA is involved in a very difficult business with a lot of stake for the taxpayer and for others. In seeking to do its job professionally, it inevitably finds itself in dispute with various parties. Some of these will inevitably seek to intimidate and discredit NAMA for their own purposes. Presumably the strategy is that if enough mud is thrown -- some of it will stick," he said.

For NAMA chairman, Frank Daly, this was an organised campaign with targeted leaking of information to selected TDs and senators and individual journalists in various news organisations. Again, the overall aim was to intimidate NAMA officials and influence their decisions, as well as to undermine its reputation with a co-ordinated smear campaign.

The chief executive said that NAMA had picked the best people it could and laid great emphasis on integrity. He acknowledged that, as with every walk of life, there were a few bad apples -- but he stressed that these were few. In fact, the gardai were investigating complaints made by NAMA itself against two former employees.

This was strong stuff. But what of efforts to help the public see clear evidence of principle and integrity in action?

John Moran, general secretary of the Department of Finance, was on hand to explain TDs' and senators' questions about the high level of Freedom of Information (FoI) requests which his department had refused on behalf of NAMA. Moran insisted that FoI was handled by an independent officer in the department and he had no authority to influence or over-rule that officer.

The FoI requests were refused on grounds that the information in the documentation was far too 'commercially sensitive' right now.

The general secretary would like to see more information being published and hoped that over time, especially as information would become less commercially 'live', to see much more put into the public domain.

It is hard to argue with the 'commercially sensitive' argument. But critics will find it does cover a multitude and frequently occurs in public information refusals.

What of the prospect of NAMA staff just sneaking stuff out the back door? Daly was confident that the computer system had a clear 'audit trail', which showed what files were being viewed by whom at any given time. Even the computer printer had a personalised user recording system.

Many of the TDs and senators appeared ready to accept this strong performance by the NAMA bosses at face value; others remained sceptical. But given the very tricky nature of NAMA's tasks, we will hear more.

The Public Accounts Committee will decide after Christmas whether they need to hear more witness evidence. Finance Minister Michael Noonan is obliged by law to carry out a review in 2014 and there will be special report by the Comptroller & Auditor General.

Questions about who watches NAMA will persist.

Irish Independent

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