Courts

High Court confirms financial sanctions for two livestock marts

Confirmation of proposed ‘major’ penalty sought by Property Services Regulatory Authority

Barrister Finn Keyes, for the Mountbellew mart, said the conduct is 'of deep regret' to his client, which co-operated fully throughout the investigation. Photograph: Bryan O'Brien

Ellen O'Riordan
Wed Mar 20 2024 - 14:03

Two livestock marts have received financial penalties after a regulatory body concluded they separately engaged in improper conduct.

The High Court president confirmed decisions to require Corcaghan Co-operative Agricultural & Dairy Society, trading as Ballybay Livestock Sales, in Co Monaghan, to pay €13,000 and Mountbellew Regional Co-operative Livestock Mart Society in Co Galway to pay €11,000.

Confirmation of the proposed “major” financial sanctions was sought by the Property Services Regulatory Authority, which regulates and licenses the sector.

The authority commenced an investigation into the financial activities of the Galway mart, of Ballygar Road, Moutbellew, Ballinasloe, in November 2021.

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In February 2023, it successfully applied for a temporary suspension of the mart’s operating licence and a freeze of its accounts over a client account deficit. However, a week later the judge lifted his orders upon hearing the deficit had been rectified after fundraising efforts raised €183,000 from community members. The mart also gave undertakings to the court to implement several financial controls.

This week, the court heard the client account deficit of between €220,000 and €230,000 arose out of a big default in 2011/2012.

Fieldfisher solicitor Zoe Richardson, for the authority, said non-client funds were temporarily placed into the account in advance of the mart’s licence renewals between 2016 and 2022. Then, once the licence was renewed, the money was withdrawn from the account.

She said this practice meant the deficit was not reflected in the account and the authority was “actively deceived over a number of years”. There was also a failure to maintain proper books and accounts, she told the court.

Factors mitigating the improper conduct included the mart’s acknowledgment of wrongdoing, that there was no loss to any client and no claim against the State compensation fund, she said.

The authority concluded the conduct warranted a “major” financial sanction of €11,000, which would also have a deterrent effect, she said. The court heard the authority is satisfied appropriate financial policies are now in place.

Barrister Finn Keyes, for the Mountbellew mart, said the conduct is “of deep regret” to his client, which co-operated fully throughout the investigation. There is “no question” of any personal financial gain or loss suffered due to it, he said.

The mart recognises the “seriousness” of the conduct and is “committed” to ensuring there is no recurrence, he added.

Separately, the authority began investigating the activities of the Corcaghan Co-operative, of Main Street, Ballybay, in March 2021, said its board chairman Michael Quinlan in an affidavit to the court.

The High Court suspended its licence for one week in November 2021 after the authority expressed concerns over debts of between €480,000 and €490,000. That would rise to €690,000 if cheques drawn from the business were cashed, the court heard then.

New management of the mart persuaded the court to allow it to trade out of its difficulties under conditions agreed with the authority.

Mr Quinlan said the deficit has been addressed. He said the mart explained it changed management between 2019 and 2020 and it subsequently transpired that office practices fell far short of what was required due to unavoidable absence from the office.

The authority concluded improper conduct occurred such that the mart held machinery auctions without having letters of engagement in place, failed to keep proper accounting records and breached the Client Moneys Regulations in how it operated its client accounts, he said.

The authority accepted there was no suggestion that members of the mart’s committee were actively involved in the activities described in the report and no suggestion of deliberate wrongdoing on the part of those currently managing it, he said.

The authority’s inspector believed robust financial policies and procedures are now in place that comply with the Client Moneys Regulations, he said. There is no question of any client having suffered a loss or of a claim being made on the State’s compensation fund, he added. The mart has fully co-operated with the investigation.

Mr Justice David Barniville said he must confirm the authority’s recommendations unless he feels there is good reason to order differently. He was satisfied both proposed penalties were reasonable and proportionate.

Ellen O'Riordan

Ellen O'Riordan

Ellen O'Riordan is an Irish Times reporter

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