Judgment reserved in Central Bank case by INBS ex-director

Judgment has been reserved on the Central Bank’s move to stop a former director of Irish Nationwide Building Society pursuing it for an indemnity against any award of damages against him arising from alleged delegation of powers of the Board of the Society to its former chief executive Michael Fingleton.

David Barniville SC, for the Central Bank, yesterday denied claims by John Stanley Purcell the bank has a liability over alleged failures to properly monitor and regulate the society concerning the alleged delegation of the board’s powers over 12 years to Mr Fingleton.

The bank did administer the system of regulation and it was not the case it “did nothing”, counsel said in closing arguments.

The four-day hearing of the application concluded yesterday before Mr Justice Brian Cregan who reserved judgment.

‘Wholly unmeritorious’

Mr Purcell has alleged the Central Bank and other State entities have joined together in exposing him to a “wholly unmeritorious” claim for damages of perhaps more than €1 billion.

State-owned Irish Bank Resolution Corporation has sued Mr Purcell and three other former directors alleging breach of contract, breach of duty, negligence over the alleged delegation of the board’s powers to Mr Fingleton from 1997 to 2009. INBS was later nationalised with losses of some €6 billion.

Mr Purcell denies the claims and alleges the Central Bank was a concurrent wrongdoer arising from the alleged unlawful delegation.

IBRC has also brought its case against former INBS chairman Michael Walsh and two other former directors, Terence Cooney and David Brophy. They deny the claims.