Inquiry strongly criticises ECB over refusal to attend hearings

The Oireachtas banking inquiry focused particular criticism on the European Central Bank over its lack of co-operation with the joint committee.

It said the attitude of the ECB stood in stark contrast to the full co-operation and engagement of the European Commission and the IMF.

The ECB was not legally obliged to engage with the inquiry but the report noted that the committee made “significant efforts to engage constructively with the ECB in order to obtain relevant and material evidence”.

Committee chairman Ciarán Lynch wrote to ECB president Mario Draghi in November 2014 to set up a line of communication and again in December 2014 requesting any documentation held by the ECB concerning the lead up to the 2008 Irish bank guarantee.

On both occasions, Mr Draghi responded that the ECB is primarily held to account by the European Parliament and does not participate in parliamentary inquiries on a national level.

But he said the ECB could take part in an “informal exchange of views” with an Oireachtas committee already “within the remit of its mandate”, in this case, the Joint Committee on Finance, Public Expenditure and Reform.

However, when the chairman of that committee wrote to ECB vice-President Vitor Constancio, inviting him to attend a July 2015 meeting, he received a reply stating that the ECB could not accept the invitation until the banking inquiry had delivered its final report.

A last attempt, in July 2015, to get the ECB to engage with the banking inquiry was also unsuccessful. Mr Draghi did agree to take questions from Irish MEPs in November 2015 but the report said this “did not in any way substitute for the lack of engagement with the Banking Inquiry”.

The joint committee said it should have been possible to figure out a way for the ECB to co-operate with the inquiry while respecting its mandate to the EU parliament.

“The joint committee is disappointed at the lack of constructive engagement by the ECB with the Inquiry due to the materiality and relevance of the ECB’s role in the Irish banking crisis,” the report stated.

David Drumm

It also noted David Drumm’s failure to appear before the committee but it said that even if the former head of Anglo Irish Bank had agreed to appear, the Director of Public Prosecutions probably would have blocked it.

Mr Drumm was issued with a direction to appear before the committee and to draft a written statement in June 2015. He refused and instead requested to appear via video link. The inquiry rejected this on the basis of legal advice and concerns from the DPP, who said it could prejudice criminal proceedings.

The DPP again intervened when the committee was considering whether to accept Mr Drumm’s written statement.

The report stated that although Mr Drumm should have complied with the direction to appear, his failure to do so is not grounds for a finding of “relevant misbehaviour” under the law.

“The DPP would almost inevitably have intervened to prevent Mr. Drumm’s appearance on the grounds of prejudice to criminal proceedings,” the report stated. “Therefore in reality, no prejudice can be said to have been caused to the inquiry.”

he report was also critical of the OECD, which failed to send a representative to the inquiry on the basis that the necessary senior staff were unavailable..

After advisors Merrill Lynch International declined to appear before the inquiry, the joint committee recommended that all contracts for expert advice services to Government should include a provision requiring the contractor to co-operate with parliamentary inquiries where requested.