Ex-Quinn bosses probed over fake meetings
The Central Bank is investigating two former directors of Quinn Insurance for holding fake board meetings to rubberstamp illegal activities in the insurance company.
Last week, the Central Bank reached a settlement agreement with Quinn Insurance where it fined the company €5m over rule breaches, which it waived as it would only cost the taxpayer more. However, the matter is not over for certain individuals who formerly worked for the company, the Sunday Independent has learnt.
Within its settlement agreement with Quinn Insurance, published by the Central Bank last week, it outlines its serious concerns about the conduct of two ex-directors, which it does not name.
These directors, according to the Central Bank, failed to bring to the attention of the insurance firm's full board the fact that it had set up guarantee arrangements valued at €1.2bn.
These guarantees when they became public caused the Central Bank to rule that Quinn Insurance was insolvent.
It was one of the main reasons why the Central Bank led, by Matthew Elderfield, decided to place Quinn Insurance into administration, wresting it from the control of the family of former billionaire Sean Quinn.
The Central Bank said the two former directors should have brought the fact that these guarantees were being set up to Quinn Insurance's investment committee but "this did not occur".
"Instead, two of the directors of the firm purportedly held board meetings of the firm on October 6, 2005, April 18, 2006 and March 28, 2007," the Central Bank said, allowing the guarantees to be put into place.
"No notice was given to the full board of the firm or to its Investment Committee of the decisions which were proposed to be made at each of the purported board meetings," the Central Bank said.
Despite a resolution in 2008 that the Central Bank should be informed of such a material move it was not informed of the matter until March 24, 2010, two days before the firm's full board was made aware of the existence of the guarantees.
The Central Bank also said that the two directors had breached Quinn Insurance's own articles of association by giving no notice to all directors that they planned to hold the meetings and that in two of the meetings there was not enough directors present for "a sufficient quorum for a valid board meeting".