Willie Kealy: If he just got a good deal, O'Brien has no concerns
Privacy is not the same as secrecy, and great wealth doesn't isolate anyone from the IBRC mess, writes Willie Kealy
A few weeks ago, David Murphy wanted to do a report for RTE's Prime Time about IBRC and its sale of Siteserv to a company owned by Denis O'Brien.
O'Brien cried foul, claiming that this was infringing his privacy because it would reveal some details of his banking business with IBRC. He went to court and got a temporary injunction
Then there was concern about whether or not the media - the newspapers, websites and RTE itself could report Dail proceedings if they happened to include elements of what was covered by the injunction. Almost without exception, the media decided to be cautious, though the Taoiseach now says he knew all along it would be fine, he just didn't like to say!
It all led to a lot of public discussion - enough to justify setting up a Commission of Inquiry in the view of the Minister for Finance, Michael Noonan. There were no new facts, just public discussion. But that public discussion made the members of the Government nervous, so they were glad of an opportunity to kick the whole thing into touch.
So into what are they inquiring? Basically, they want to know if the way in which the zombie bank the IBRC administered the affairs of the bust financial entities Anglo Irish Bank and Irish Nationwide was in the best interests of the taxpayer. The bank was administered by a board chaired by Alan Dukes with chief executive Mike Aynsley, who have understandably been the most vocal in their insistence that there is nothing into which to inquire. At times they sound like Vietnam veterans, telling us that we weren't there so we can't know what it was like. But you have to have some sympathy for people who were administering the fallout from a national disaster, only to have their every action subsequently second guessed by armchair experts using the slide rule of best banking practice with the benefit of hindsight.
Of course what makes all this sexy is the presence right in the middle of everything of Denis O'Brien, probably Ireland's richest man and the biggest shareholder in INM, which owns the newspaper you are now reading. I don't know the man, never met him, never spoke to him, never even saw him in the street. But I do know, like everyone else in the country, that O'Brien had mighty big loans from Anglo and he also bought Siteserv, an IBRC "asset," from which the bank board and management were trying to salvage some money.
In principle, everyone is entitled to privacy over their ordinary banking affairs, and this is not a matter of degree, so that right should not disappear as you grow rich. But this inquiry is about IBRC, not about Denis O'Brien per se. We are all touched by IBRC. Some of us have lost jobs, some have lost wages, some of us have had our pensions cut drastically while some very rich people were relatively unscathed which creates a social divide that leads to resentment. But none of us - rich or not - can stand in isolation from the mess that was once Anglo Irish Bank and Irish Nationwide, and that includes Denis O'Brien.
Catherine Murphy is an Independent TD who took it upon herself to investigate the sale of Siteserv. What spurred her on was the stupid refusal of Michael Noonan to give her straight answers when first she started asking questions. Using a combination of parliamentary questions and Freedom of Information requests, she discovered that the existing shareholders of Siteserv shared in a pot of €5m, without having to make too much effort to earn it, and that there had been two professional reports, one of which recommended paying the shareholders as little as zero while the other recommended €5m. The shareholders ended up getting the highest figure recommended. Even more important was her discovery of a flurry of trading in Siteserv shares just before the deal was done. This doesn't sound good, and hopefully the inquiry will be able to shine some light where the Stock Exchange has not. Plus, she discovered that senior civil servants were far from happy with a number of IBRC transactions. This unhappiness was effectively concealed from the Dail by the Minister for Finance.
That concealment was enough to force the Government to hold an inquiry, but once again it did it arseways, appointing Kieran Wallace of KPMG as one of the people to look into various deals, including the sale of Siteserv, in which KPMG had been involved. Micheal Martin has raised a couple of other issues - the employment of Blackstone for valuations without tender and why the IBRC wealth management unit needed to be looked at by William Fry.
Catherine Murphy did not uncover any kind of wrongdoing on the part of Denis O'Brien, but she carried on and eventually received a document from "sources" which indicated that when O'Brien's Anglo loans were transferred to the new bad bank, he sought to continue the favourable rates he had been enjoying. The document she received suggested a rate of 1.25pc on a €500m performing loan. Deputy Murphy thought this rate should have been as high as 7.5pc. Alan Dukes and Mike Aynsley were outraged at the suggestion that they did any kind of cosy deal with O'Brien. He was a performing borrower of a very large sum of money and was dealt with as such. All cases were treated differently, small different to large, performing different to non-performing, solid asset-backed loans were not treated the same as those with worthless collateral.
Mr O'Brien's spokesman, James Morrissey, accused Catherine Murphy of using documents that had been stolen and altered. He went on to say "the Dail is a bit of a talking club, they want their own rules for themselves." Just as great wealth should not put an individual beyond the right to privacy, neither should it embolden a spokesman for a person of great wealth to speak so disrespectfully about our national elected parliament.
And it should be remembered that a right to privacy is not the same as a right to secrecy. When Michael Noonan finally accepted that he would have to have a proper inquiry, he called in all the relevant Opposition spokespersons last week, including Catherine Murphy, and worked out terms of reference, which seemed fine until Pearse Doherty of Sinn Fein stood up in the Dail on Tuesday last and read a few more morsels of information into the record.
He told us about a 3pc rate of interest which Mr O'Brien was seeking from the liquidator, and which, we are told, he eventually got by threatening legal action. We don't know if this is correct or not, any more than we know if Catherine Murphy's figure of 1.25pc is right. Denis O'Brien has denied Murphy's figure and the liquidator has said Doherty's claims are wrong, but neither has produced an alternative.
The Government says Judge Daniel O'Keeffe will be able to look into this because it is something that originated before the liquidation date of February 7, 2013 - the cut-off date in the terms of reference of the inquiry. But it could have extended the time period just to make sure, instead of banking on "flexibility." Minister for Jobs Richard Bruton says this would constitute chasing every rabbit down a rabbit hole. Well, on the face of it, this looks like a rabbit worth at least checking out. And if Richard Bruton, or any other member of the Oireachtas does realise later on that there are relevant rabbits which cannot be pursued, it will be too late to take on the role of pointer for the hunting judge.
For Denis O'Brien, there should be nothing to fear from a Commission of Inquiry if all he is hoping to keep private are the details of how he tried - and possibly succeeded - in getting the best terms from one of his bankers. If that is the conclusion of the inquiry, he will suffer no more reputational damage from this episode than the inevitable begrudgery any other enormously wealthy person could expect in similar circumstances.
That would be significantly less than the "level of hatred" he feels he has experienced over the last few weeks, in consequence of his efforts to protect his privacy.