Nothing will change under new Central Bank governor

Irish Times columnist Cliff Taylor has a piece in today’s edition on what skills the next governor of the Central Bank will need to do his/her job.

Here’s the key point in the article:

Whoever gets the job, the public verdict – rightly or wrongly – will quickly form on whether Ireland is going back to the old days of a central bank “captured” by Government and the banks, or whether the institution’s independence is underpinned for the future.

Here’s the reality:

For decades there has been a corrupt nexus between the political system, the Central Bank and the banking sector. The principal function of this corrupt nexus is to allow bankers to rob and plunder the resources of the state and its citizens at will.

The Central Bank has never acted independently; it will not act independently under the new governor, no matter who gets the job.

Joan Burton’s new watchdog

The chief warden at the State’s watchdog compound was not happy to hear the news, so he rang Tanaiste Joan Burton to vent his anger.

Tanaiste; is it true, is the Government giving birth to yet another watchdog?

Now, now chief, calm down. It’s only a temporary measure; as soon as the election is over we’ll have the new arrival put to sleep.

But Tanaiste, we’re already overrun with watchdogs, they’re everywhere and, as you well know, none of them actually watch anything.

Yes, I’m aware of that chief but they do give the impression that there’s regulation and, as you well know, that’s all that matters to politicians.

What about the biggest, most expensive watchdog of them all, the Financial Regulator? Surely it’s his job to watch the banks, surely you should set him on the banks to make sure they treat those in mortgage difficulties with fairness?

Ah bless your innocence chief. This has nothing to do with fairness for ordinary people in trouble with their mortgages. No, this is about protecting the banks, to give them every opportunity to extract every last penny from the peasants.

But…but…Michael Noonan was here just the other day talking to the watchdog about the mortgage crisis and I heard the Taoiseach call on the banks to be nice to those people desperately looking for help.

Now chief, I’m beginning to lose patience with your naivety. My colleagues Michael and Enda weren’t actually demanding action, perish the thought. No, like myself, they were giving the impression of action, a completely different breed of animal, so to speak.

What about the cost Tanaiste? Every watchdog in this compound costs a fortune to maintain, a board, expenses, bonuses, the lot.

As I’ve already said chief, when the election is over we’ll quietly put this watchdog to sleep and continue with our policy of protecting the interests of the banks.

By the way chief, are you calling me on a smart phone?


Tell me, where did you get the money for such an expensive item…?

Irish Independent does not approve of new ECB headquarters

The editor of the Irish Independent is not happy that the European Central Bank (ECB) is forking out €1.3 billion on a new headquarters.

I wonder has the editor said anything about the €147 million (probably €247 after all the nods and winks have been paid for) being forked out by our own Central Bank on its new headquarters which will include a seventh-floor cafe with an outdoor terrace where staff can enjoy stunning views of the river Liffey.

Just asking.

Journalist Michael Clifford: Getting it wrong on the bank inquiry

According to journalist Michael Clifford the lack of a paper trail concerning the major decisions taken during the 2008 financial crisis is of minor importance (Irish Examiner).

If that were all that was wrong in the department, we’d all be in clover.

In his article Clifford leads the raging elephant of political/administrative corruption into the room, sticks a long, well sharpened spear up the creatures rear end to ensure maximum pain and then proceeds to completely ignore the ensuing rampage.

Instead he focuses on what he obviously believes are more important aspects of the first days of the latest banking inquiry.

Like, for example, how finance officials had to go home to find out details of that year’s budget or how Fianna Fail is reacting to the inquiry.

This journalist could not be more wrong.

The lack of a paper trail is the single most important aspect of the entire disgraceful episode because it tells us just how corrupt our political/administrative system has become.

Allow me to analyse Clifford’s raging elephant in the room.

Rob Wright, the Canadian public servant who compiled a report on how the Department of Finance was asleep at the wheel during the boom, gave evidence.

Rob Wright is wrong in his conclusion that the Department was asleep at the wheel.

The Department of Finance was not asleep at the wheel. The Department was fully aware of what was happening throughout the boom years, the Central Bank, Revenue and all other relevant state agencies also knew exactly what was happening.

No action was taken because our corrupt political system was, and still is, more concerned with protecting the interests of those who benefitted hugely from the boom than they were/are in the interests of the Irish people.

All our state agencies, including the police, operate under the direct control of our corrupt political system.

Wright was ‘flummoxed’ by the lack of a paper trail surrounding the major decisions made during the crisis.

He was told by many public servants that it was the Freedom of Information Act that was to blame. Nobody wanted to commit to paper anything that might come back to haunt them.

There could be serious ‘hassle’, he was told, if an FOI request revealed a difference of opinion between a minister and a civil servant.

One minister, we’re told, ‘had a lot of concern’ about the Freedom of Information Act after one such revelation.

It is deeply disturbing that civil servants can casually dismiss their disgraceful actions/inactions because of a fear of ‘hassle’ from a minister.

It is deeply disturbing that a minister (and, of course, he/she is not alone in this) expresses concern at the prospect of citizens becoming properly informed by way of an FOI.

It is deeply disturbing that any meeting of ministers and their senior public servants could be conducted without any notes/record being taken never mind the major, life impacting decisions taken during the financial crisis.

To put it bluntly, only those in charge of the most perverse, corrupt, diseased banana republic would think it acceptable to make such decisions while consciously deciding to keep no record in case they were made to account for their betrayal.

As far as I am aware, and I hope to check on this further in the coming year, there is a legal requirement for civil servants to record all minutes of all government/ministerial meetings.

Journalist Clifford ends his article:

The jury is still out on whether this whole thing will amount to a hill of beans.

Wrong again:

The jury is in, every informed person knows what happened, knows that the current inquiry is a disgraceful farce, knows that it won’t even amount to a hill of beans.

The people, in recent elections, polls and protests, have given their verdict – Guilty.

They have delivered their sentence – The abolition of our corrupt political/administrative system.

All that remains is for the sentence to be carried out and, hopefully, that will be sooner rather than later.

Copy to:
Michael Clifford
Department of Finance
All political parties

The truth about politicians, regulators and bankers

Letter in today’s Irish Times.


There is now no doubt that in the past we got the kind of regulation that our governments and increasingly powerful business lobbyists wanted.

The Government appointed the regulator and, no doubt, outlined the job specifications, which seem to have been roughly: “A regulator is just a civil servant, he never gets high-falutin’ notions and doesn’t get in the way of big business. ”

Despite the appalling consequences of our lack of effective regulation and legislation in the past, John Bruton, the former taoiseach of a Fine Gael-led coalition, in his capacity as chairman of the IFSC, told the European Insurance Forum Conference in May 2013 that we needed to put a rein on financial regulation.

Some banks, he claimed, had handed back their licences because of oppressive regulation, regulation which was risk-averse. ome weeks later an American businessman, interviewed on an RTÉ radio news programme, candidly stated that one of the factors that attracted US investors to Ireland was our “low regulatory hurdles”.

Matthew Elderfield, while acknowledging the greatly improved staffing levels in the regulator’s office, has severely criticised the present government’s failure to implement recommendations he made before his departure from his position as financial regulator.

No doubt, as soon as the Dáil committee of inquiry has completed its work we will be promised effective legislation and a robust regulatory regime. However, powerful forces will be working openly and behind the scenes to dilute or hinder these measures.

Yours, etc,
Denis O’Donoghue,
Co Kerry

Elaine Byrne and judge Nolan: Clueless regarding the reality of white-collar crime

What do corruption expert Elaine Byrne and the Anglo trial judge have in common?

Both of them are utterly clueless about the reality of how things are done in our corrupt state.

Byrne tells us that our poor white-collar crime laws must be overhauled.

Despite writing an enormous tome on the subject of corruption she remains blissfully unaware that it is the State itself that is corrupt.

It is the State that ensures that those who inhabit the Golden Circle are protected from the laws that are rigorously enforced against ordinary citizens.

She seems blissfully unaware that the State will never, ever act against white-collar crime because the State and the white-collar fraternity are joined at the hip; they are both members of the same corrupt club.

The evidence for this fact is overwhelming and is outlined in great detail in her book.

Judge Martin Nolan seems to be similarly clueless of the connection between white-collar crime and the corrupt political/administrative system that (mis) governs the country.

We can see this from his comments.

I am totally surprised that the regulator did not give some warning to Anglo Irish Bank.

It seems to me incredible that the regulator did not take advice from other state agencies. I find it incredible that red lights didn’t go off in the office.

Like Ms. Byrne he seems to be totally unaware that the so-called Financial Regulator/Central Bank does not regulate at all when it comes to white-collar crime – ever.

I don’t mean light touch regulation; I mean zilch, zero, Nada regulation when it comes to crime within the Golden Circle.

To be genuinely surprised by the behaviour of the so-called Financial Regulator judge Nolan would have to be completely unaware of the decades long failure of the various so-called Financial Regulators to act against white-collar criminals.

And perhaps that is the case, perhaps he is so unaware.

Copy to:
Elaine Byrne
Financial Regulator

Patrick Neary: A warped mind-set that is by no means unique

I have reproduced below the full text of an article in today’s Irish Times by Vincent Browne regarding the evidence given by former Financial Regulator, Patrick Neary, during the recent Anglo trial.

The article is very important because it clearly illustrates just how rotten our political/administrative system has become over recent decades.

Neary makes no attempt whatsoever to give rational replies to questions. He is supremely confident that he can say whatever he likes, no matter how ridiculous.

He knows with an arrogance bred over a long and disgraceful career that nobody, no individual, no regulatory authority, no legal authority; no State authority can touch him.

His attitude of supreme immunity from accountability sees him treat the court system and by extension the State with total contempt.

His warped attitude towards his own self-respect and the good of his country is by no means unique.

A significant percentage of those wielding power and influence in our corrupt state operate with the very same warped mindset.

The meetings not noted, the questions unasked

Vincent Browne

On Thursday, March 13th, last, Patrick Neary, the former financial regulator, gave evidence at the Anglo trial about a meeting he had with David Drumm, then chief executive of Anglo Irish Bank on September 12th, 2007.

The meeting occurred on the day after Drumm and Seán FitzPatrick (then chairman of Anglo Irish Bank) had heard from the businessman Seán Quinn that Quinn had amassed, indirectly through contracts for difference (CFDs), a 24 per cent shareholding in the bank, a situation that imperilled the viability of the bank and the Irish financial system as a whole.

Arising from that revelation, the Anglo board, according to a number of its members, directed Drumm to meet and inform the regulator of the precarious situation that had transpired. There were two meetings with Neary – on September 12th and September 27th.

No recollection

Neary had no recollection of a second meeting with Drumm. He was asked by a defence counsel, Michael O’Higgins, if he had kept a note of the meeting on September 12th, 2007, with Drumm, the meeting that he did recall. Neary said he had not kept a note of the meeting.

Asked if he kept notes of meetings in the normal course of his business, he said he did but in this case Drumm had asked could he drop in to see him as there was something he wanted to discuss privately.

It was “a special meeting of a personal nature that was [what was] conveyed to me before [Drumm] came in”.

Q: “Well I would regard personal nature like I’m having problems at home or where I’m going on holiday. I take it we’re not talking about that?”

A: “Well it allowed for that possibility.”

Q: “It did, did it?”

A: “Yes it did because I had no idea what kind of an issue a chief executive of a financial institution might come and raise with me .”

Q: “Well, could it have something to do with finance – rather than trouble at home ?”

A: “Oh, it could be to do with anything, but I got the impression that – from Mr Drumm – that this was very much an informal chat he wanted to have with me .”

Also in his evidence on Thursday, March 13th, last, he said Drumm expressed concern at that meeting about rumours “about possible holding of CFD positions against shares in the bank . . . That Mr Quinn may have held up to 10 per cent of the shares in the bank by way of CFDs”.


He said Drumm was “worried that perhaps the CFD holdings by Mr Quinn was even bigger than that but he had no way of finding out and he wanted to see what information, if any, that the authority had or was there any way we could find out”. He insisted Drumm did not inform him that Quinn’s CFDs position amounted to 24 per cent.

Neary had a meeting with Quinn subsequently, in January 2008. He was asked:

Q: “Did you ask him [about his CFD position in Anglo] ?”

A: “Well I didn’t – I didn’t ask him straight up.”

Q: “Yes?”

A: “I came about it in a way that there’s talk you may have some CFD positions, and he responded that he had CFD positions in Ryanair and in Anglo but they weren’t very large and he didn’t intend to hold them . . .

Mr Quinn is entitled to, as a private citizen, to have all the investments he wanted to have and I respect that and I didn’t feel that it would be fair or appropriate for me to tackle a person about his own personal investment portfolio.”

Neary also gave evidence about his office’s supervision of how Anglo was dealing with the crisis caused by Quinn’s CFDs, a crisis that he acknowledged in his evidence was a threat to the entire financial system.

No records

He was asked by defence senior counsel Brendan Grehan if he had kept any records of information he was receiving from the second-in-command in his office, Con Horan ( then prudential director at the regulator’s office.

He replied: “No, I did not”.

Q: “Not even as much as a diary note?”

A: “No, I did not .”

Q: “A memo?”

A: “No memo, no record whatsoever.”

Q: “Something for the file?”

A: “No record whatsoever. I believed Mr Horan would give details of what was going on for the file and would maintain the records .”

Q: “Well the strange thing , maybe just a coincidence, is that Mr Horan, it would appear, didn’t make any record or doesn’t have any record, save for a note he prepared . . . in advance of the [regulatory ] authority meeting of 23rd of July . He thinks he prepared it perhaps a day or so before that.”

A: “Okay.”

Q: “So he doesn’t have any records and you don’t have any records either?”

A: “No, I don’t have.”

© 2014

Twenty year later: We're still waiting for real financial regulation

From the Attic Archives Irish Times 25 June 1994


The concern expressed by the banking community at the prospect of regulation by the Director of Consumer Affairs could be well founded.

I recently discovered that my bank had been overcharging me for its services.

On the reasonable presumption that my experience was not unique and that there might be, as the judges say, a lot of this sort of thing going on, I wrote to the Central Bank suggesting improvements in the format of bank-statements.

I also suggested that banks, like other providers of goods and services, should be required to invoice customers for bank-charges before they dipped into their customers’ accounts.

I subsequently received a letter from the ‘Credit Institutions Supervision Department’ of the Central Bank, informing me that the Central Bank “would have no objections” if the banks were to revise their procedures.

No wonder the banking community is quaking in its well-heeled boots at the prospect of losing the protection of such an amenable ‘regulator’.

Yours etc.,

Peter Murray
Co Cork

Points to note from this 20 year old letter:

The so-called Financial regulator did not regulate financial institutions at that time, it was a free for all.

The fact that there was no financial regulation whatsoever allowed financial institutions to engage in widespread criminality.

The decision by the corrupt political/administrative system to allow the rampant growth of our Wild West financial culture played a major role in the widespread improvishment of millions of Irish citizens post the 2008 crash.

And, most importantly, the exact same culture exists today. There is no effective financial regulation in Ireland.

Central Bank: A lackey for the political system

I see the Central Bank has, yet again, been caught out in a lie.

Earlier this week the bank announced that there was a fall in the numbers in mortgage arrears for the first time in years.

UCC economics lecturer Seamus Coffey has revealed that the Central Bank’s figures are useless as they fail to take into account mortgages that originated in this country but were sold by Bank of Scotland.

What’s going on here is as simple as it is dishonest.

The Central Bank is nothing but a lackey for the political system. It has no credibility as an independent, professional institution. Its principal mission, as always, seems to be to do the bidding of its political masters – at the expense of Irish citizens.

Copy to:
Central Bank