Irish Nationwide inquiry makes findings against former finance director Purcell – The Irish Times
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The long-running inquiry into former senior Irish Nationwide Building Society (INBS) figures has made findings against the lender’s former finance director, John Stanley Purcell, the final individual subject to inquiry.
The chairwoman of the inquiry, Marian Shanley, told a case management hearing on Monday that a findings report had been issued to Mr Purcell on April 30th. It found that Mr Purcell participated “in respect of certain” regulatory breaches – or so-called specific prescribed contraventions – that INBS was found to have committed.
Ms Shanley did not specify the specific breaches, but signalled that she plans to hold a hearing for potential sanctions in the autumn. While she mentioned holding the hearing on October 14th, on hearing that this did not suit all parties, she agreed to hold off on finalising a date.
“The Findings Report … contained the findings of the inquiry members that INBS had committed specific prescribed contraventions. A total of 23 such findings were made in respect of INBS out of the total of 42 specific allegations,” Ms Shanley said. “Findings of participation were made in respect of certain of these prescribed contraventions by Mr Purcell.”
Mr Purcell said he had no questions or points to make when asked by Ms Shanley at the case management hearing. He had consistently defended himself robustly during inquiry hearings and has been asked to make certain submissions to the inquiry by the middle of August.
Sanctions can range from a caution or reprimand to disqualification from working in a financial firm and a fine of as much as €500,000. The case relates to a period before maximum individual monetary sanctions were doubled to €1 million in 2013.
Mr Purcell is the only remaining individual among five people originally subject to the inquiry when it was established in 2015.
Since public hearings started in late 2017, the Central Bank has reached settlement agreements with three of original five – former INBS chairman Michael Walsh, one-time head of commercial lending Tom McMenamin and former head of UK commercial lending Gary McCollum.
It dropped its case against the failed lender’s former long-standing managing director, Michael Fingleton, now 86, in December, 2019, due to his ill-health.
The inquiry, which has held public hearings sporadically during its lifespan, was set up to look into seven sets of alleged regulatory breaches between July 2006 and September 2008, including that INBS allegedly failed to process loans in line with its own policies, failed to obtain property security for commercial loans, failed to get proper valuation reports on assets it was lending against or to establish credit risk policies for profit-share agreements with developers during the boom.
Between 2008 and 2010, INBS suffered financial losses in excess of €6 billion, primarily arising from the impairment of its commercial loan book. INBS cost taxpayers €5.4 billion to rescue during the financial crisis before its remains were folded in 2011 into Anglo Irish Bank.
The combined entity, known as Irish Bank Resolution Corporation (IBRC), was put into liquidation in 2013.
INBS had the most toxic loan book of the six lenders guaranteed by the State in September 2008. Nama applied the biggest discount – as much as 72 per cent – to the society’s loans when it took over commercial property assets of the sector during the crisis.
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