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The CHC fraud proves that there is no effective financial regulation in Ireland

December 4, 2011 in Banks & Finance, Corporate, Government, IFSRA, Regulatory Agencies by Anthony | 1 comment

Prior to the collapse of Ireland’s economy in 2008 there was a universal belief that Ireland possessed a functional financial regulatory system.

Subsequent to Ireland’s economic collapse there was a universal belief that light touch regulation was the core factor in bringing about the catastrophe.

Presently there is a universal belief that financial regulation has been radically reformed and is now fit for purpose.

All of the above beliefs are false.

Ireland has never enjoyed the benefits of real financial regulation. This is not an opinion, it’s a fact.

No financial institution or official has ever been charged with a crime despite the theft of countless millions over the decades.

Ireland did not suffer from light touch regulation; it was destroyed because there was no effective financial regulation whatsoever.

So called regulators knew about most of the major crimes committed over the years, like DIRT and Ansbacher, but did nothing.

When the media and whistleblowers (the real regulators) uncovered crimes that the Financial Regulator was not aware of no significant action was ever taken against the criminals.

As I write Irish citizens are continuing to suffer great losses because there is still no effective financial regulation in Ireland.

If what we are told by politicians, government officials and so called regulators is true, then the people involved in the Custom House Capital fraud would, at the very least, be under arrest.

That the people involved in this fraud are still walking around, enjoying the same rights and freedoms that law abiding citizens are entitled to, proves that there is still no effective financial regulation in Ireland.

Custom House Capital specialised in pensions for wealthy customers and managed investments of about €1.5 billion for about 1,400 clients.

The firm also invested in property in France and Germany on behalf of clients.

The company misused €56 million in clients’ money to cover up troubled property deals.

A report on the matter submitted to the High Court states:

There was a systematic and deliberate misuse of assets and cash belonging directly or indirectly to clients of CHC.

This misuse was deliberately disguised by CHC through the use of false accounting entries and the issue of false and misleading statements to clients.

The High Court ordered all reports on the matter to be sent to the Director of Corporate enforcement, the DPP, the Garda Commissioner and Revenue.

The so called Financial Regulator investigated CHC in 2009 after somebody noticed a strong odour coming from the company but, predictably, found nothing of great import.

Some managerial changes were recommended and the matter was dropped.

It was only when another company, Appian Asset Management, had taken over the non-property investment assets of CHC that serious concerns were raised.

It was only after this company acted that the so called Financial Regulator took any significant action.

Let’s repeat these facts as starkly as possible.

In 2009 the so called Financial Regulator carried out an in-depth investigation into CHC and found that, apart from some supervisory and organisational issues there was no significant problems with the company.

Here’s what the Regulator decided to do.

Following the identification of these supervisory concerns, related to compliance and organisational issues, the strategy was to encourage CHC to identify and engage with potential buyers for the firm, which would be the best outcome to protect client investments and funds.

CHC took that advice and shortly thereafter sold part of its business to another company, Appian Asset Management.

It seems that this was an attempt by CHC to off load that section of its business where the fraud occurred while holding onto its property assets.

Remember, this is, effectively, what the Financial Regulator advised.

The crucial point in all this is that a company that wasn’t engaged in any investigation easily discovered major fraud in a company that had just been investigated by our so called reformed and fit for purpose Financial Regulator.

It should also be noted that CHC was heavily engaged in fraudulent activity in 2009 when the Financial Regulator was, allegedly, investigating the company.

One of the victims of this CHC/Financial Regulator scandal precisely summed up my views on this matter (My emphasis).

I would like to see some criminal charges against those involved.

I would like to see an action taken against the Central Bank (Financial Regulator) because they were protecting the firm when they should have been protecting the consumers.

As I say; there is no effective financial regulation in Ireland.

Copy to:

Financial Regulator
Dept. of Finance
Director of Corporate Enforcement
DPP
Revenue
All political parties

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Reminder: Ireland is not to blame for the catastrophe

November 29, 2011 in Banks & Finance, Media coverage, The State by Anthony | No comments

At the very beginning of a Prime Time special last night viewers were ‘informed’ of who was responsible for Ireland’s woes.

2,000 miles away a country in turmoil lit the spark in a wildfire that would overwhelm Ireland and threaten to destroy the single currency.

Greece, according to the programme, was brought to the brink of financial collapse by a combination of corruption, chronic indebtedness and a dysfunctional tax system.

Ireland, on the other hand was ‘damaged’ by a combination of reckless banks, inept regulators and disastrous economic policies.

For a full hour the programme analysed the loss of Ireland’s financial independence without once mentioning the word ‘corruption’.

It is no mean achievement to analyse a country brought to ruin by political, financial and administrative corruption without once referring to that reality.

Greece is corrupt; Ireland is not, apparently.

So let’s bring ourselves up to date on who is to blame for the catastrophe visited upon Ireland.

The global financial crisis.

Lehman Brothers.

The German and French banks

And now – the Greeks.

Copy to:

Prime Time

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For Marian Finucane’s information…

November 29, 2011 in Banks & Finance, Government, Media coverage by Anthony | No comments

One of the ‘sensational’ claims made by David Drumm to journalist Niall O’Dowd was that Central Bank and the Financial Regulator knew everything that was going on in Anglo and that they in fact acted as a ‘team’ throughout 2008.

O’Dowd admitted that he was completely unaware of this situation and clearly sees it as a major, new, news story.

Finucane was also astonished on hearing the claim. It would be quite extraordinary, she gasped.

Such ignorance from O’Dowd is understandable, he lives in America and is obviously not the brightest of journalists.

But there is no excuse for Finucane who has, for decades, been at the centre of events in Ireland.

She must know (or maybe she doesn’t) that the Dept. of Finance, the Financial Regulator and senior politicians knew about the DIRT fraud, knew about the Ansbacher fraud and knew about dozens of other frauds within the Irish financial sector over the decades.

The authorities never took any action to bring these frauds to an end. The criminals were allowed free rein to plunder the state and its citizens at will, without fear of ever being brought to justice.

And just for Marian Finucane’s information, the situation remains exactly the same as I write.

That is, there is still no financial regulation in Ireland when it comes to the financial sector; crime is still rampant within the sector.

Copy to:
Marian Finucane

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Take your medicine like the Irish have

November 22, 2011 in Banks & Finance by Anthony | No comments

To take your medicine like the Irish have.

Comment by BBC4 newsreader to Spanish commentator on Spain’s attempts to resolve its financial crisis.

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Politicians will be forced to face brutal reality of mortgage crisis

November 8, 2011 in Banks & Finance, Government by Anthony | No comments

For months before the publication of the Keane Report into the mortgage crisis we heard Minister for Finance and other politicians dodge questions by saying:

We have to wait until the Keane Report is published; then we will take immediate action.

Predictably, these promises were just the usual political lies.

Minister for Social Protection, Joan Burton, has just launched the next phase of delay and waffle.

The adoption of many of the proposed reforms will have to wait until legislative changes to the personal insolvency laws come into force next year.

In normal circumstances such dishonest behaviour by politicians can be stretched out to years, even decades.

Time, however, is almost up for such dishonesty because the mortgage crisis is coming to a head and politicians are going to be forced, whether they like it or not, to deal with brutal reality – it will not be a pretty sight.

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The banks are not (really) owned by the state

November 8, 2011 in Banks & Finance, Government by Anthony | 2 comments

We’ve heard a lot of tough talk recently from the so called Financial Regulator, Matthew Elderfield, and various ministers warning banks not to increase mortgage rates and to reduce rates in line with the ECB reductions.

Well, we can see from the two fingered response of NIB and other banks to the latest ECB rate reduction that all the government tough talk is nothing but hot air.

The Government can do nothing to force the banks to comply with their wishes, the banks can and will continue to screw their customers with complete impunity.

Many people are puzzled that while most of the banks belong to the state (the people) the government seems powerless to tell them what to do.

In reality, of course, the banks are not owned by the state.

They are in ‘pretend’ ownership until all the billions recklessly gambled, robbed and wasted by the banks is either paid immediately by current taxpayers or set aside to be paid for by generations of taxpayers to come.

As soon as the time is right, the banks will be handed back to the greedy criminals and the corrupt roundabout will continue to turn.

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What are these people on?

October 27, 2011 in Banks & Finance, Government by Anthony | No comments

Finance Minister, Michael Noonan, has said that Ireland’s main strategy was to grow its way out of trouble – Good luck with that Mr. Noonan.

He also labours under the same delusion as Lucinda Creighton, that Ireland is different from Greece.

Greece, says Mr. Noonan, will be in trouble for many years while Ireland will be ‘back to normal’ in a year or two.

Meanwhile, IMF chief economist, Oliver Blanchard, has been tragically infected with Brian Lenihan’s ‘we’ve turned a corner disease’.

Speaking to students at Trinity College today he said Ireland was doing great and would soon be out of trouble.

I have just one question – What are these people on?

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Rabbitte defends the bankers

October 24, 2011 in Banks & Finance, Government by Anthony | 4 comments

The Minister for Communications, Energy and Natural Resources, Pat Rabbitte has been doing a great job recently defending the interests of the banking sector.

The interdepartmental group that produced the Keane Report on the mortgage crisis was made up of two bankers, 16 civil servants and Keane himself was seconded from KPMG

Marian Finucane commented that it was remarkable that organisations like MABS or Legal Aid weren’t involved in the report.

Rabbitte replied in his number one condescending voice:

No it isn’t Marian, no it isn’t and I’m one of the most stringent critics of the reckless behaviour of bankers.

You cannot address this issue without having bankers present in terms of the ramifications for the banking system.

In other words – I’m not answering the question.

Someone else challenged him on the fact that bankers were still paying themselves vast amounts of money.

Again, in his Sunday best condescending voice, Rabbitte patiently tried to explain things to the great unwashed.

Let’s not get carried away now, let’s not get carried away, I mean that’s not true. The bankers pay has been cut dramatically…

Look it, we’ve been landed in this mess, we have to have to try and deal with the unfortunate people in acute distress about losing their homes.

In other words, stop talking about greedy bankers; after all I’m supposed to be a left wing, for the ordinary people politician.

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Prediction of economic disaster

September 14, 2011 in Banks & Finance, Government, The State by Anthony | 3 comments

Just came across this letter that I submitted to the Irish Times on 20th Oct 2004 in response to the then latest scam by AIB.

Madam,

Mr. Buckley of AIB is wide of the mark in likening the current scandal to an iceberg where the vast amount of transactions are genuine but unseen by the general public while the relatively ‘small number of errors’ are emphasized by the media. (RTE News, 20th Oct.).

The stark reality is that AIB is a rogue iceberg rampaging unregulated across the sea that is the Irish economy. The ship of state, captained by a government that steadfastly refuses to heed the many warnings of impending disaster, is steaming full speed ahead on a collision course with this rogue iceberg.

When the inevitable happens, the international economic reputation of Ireland will plunge headlong into the icy depths of global contempt.

Yours etc.,

Anthony Sheridan

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Nothing will change until the corrupt political system is destroyed

August 30, 2011 in Banks & Finance, Body Politic, Government, Regulatory Agencies by Anthony | 2 comments

A caller to today’s Liveline provides us with a good example of the ruthlessness and greed of the banking sector.

The caller, an elderly lady, used her entire life savings to pay €100,000 off her son’s mortgage when he found himself in deep trouble.

The bank, the EBS, must have been rubbing its hands in glee as this part of the mortgage was on a tracker contract and so its payment would save the bank a substantial amount of money.

The woman then asked the EBS to come to an agreement for the rest of the mortgage (€50,000) which was on a fixed contract.

Not a chance lady, if you want to pay this part of the mortgage off we will impose a substantial penalty.

It’s the law she was told, it’s policy she was told.

You do us a favour, we screw you.

The Minister for Social Protection, Joan Burton, took time our from her busy schedule organising a no holds barred crackdown on alleged social welfare fraudsters to gently ask the banks to go a bit easy on the increasingly desperate peasants.

I actually would like to see the banks becoming active in reaching out to the citizens who have become embroiled in debt because of the recession, losing their job, losing their business.

The critical thing, said the Minister, is that people should engage with their lender.

We can see from the above example what happens to people when they ‘engage’ with their ruthless lenders.

Fergus Finlay has a good article in today’s Irish Examiner on the mortgage crisis in which he brings up the subject of revolution.

In my opinion the big picture is very simple.

The corrupt political system allowed the banks and others destroy our country.

The corrupt political system continues to protect the banks and others who destroyed our country.

Nothing will change until the people destroy the corrupt political system.

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