Oireachtas inquiry into banks would not answer questions that need to be answered
Let us not have another charade that only demonstrates our institutional weakness
What did the European Central Bank, guardian of the stability of the euro, do when it was told that bank lending in Ireland for construction and property development had increased by 1,730 per cent between 1999 and 2007? Photograph: Bloomberg
The problem is that the banking system was allowed to treat the State and its citizens as a joke. And the solution to that problem is another joke: a parliamentary inquiry into the collapse of the banks that will be unable to make any disputed findings of fact in relation to the conduct of bankers.
Except for public officials, it will not be able to say anything that damages anyone’s “good name” – David Drumm’s, for example. Furthermore, no TD or senator who has had anything critical to say on the issue of the banking collapse can be a member of the inquiry because “a perception of bias might arise”. Only those politicians who have been essentially indifferent to the biggest scandal in the history of the State can inquire into it.
What is it that we need to know? We know already that the banks were turned into casinos, that the property bubble was deliberately inflated by Fianna Fáil and the Progressive Democrats, that regulation was farcical and that government and senior officials were hopelessly out of their depth when the crisis hit. What we don’t have an adequate fix on are three crucial factors. Why was there complete impunity for corruption in the banking and political systems? How exactly did the nexus of connections between bankers, property developers, politicians and officials work? And what, exactly, were the roles in the whole debacle of the International Monetary Fund and the European Central Bank?
Here, for example, are some questions any useful inquiry would have to address:
The key questions
“Why were there no prosecutions or disbarment of directors after the Dirt inquiry found in 2001 that the banks had engaged in a massive fraud on the State?
“How were the banks able to see off proposals for directors’ compliance statements and codes of corporate governance after that scandal?
“What was the effect on the regulatory culture of the discovery by Central Bank officials that both a serving taoiseach and a member of their own board were involved in the Ansbacher scam, operated by one of the banks they were regulating? Why did the Central Bank doctor its own internal files on the Ansbacher scam to remove references to criminal tax evasion?
“How much money did political parties, especially Fianna Fáil, Fine Gael and the PDs, get from property developers and banks during the boom years?
“How many regulators went to work for the banks they had been supervising and why?
“Why were proposals by the Revenue to tax contracts for difference (proposals that would have prevented Sean Quinn’s disastrous building of a secret stake in Anglo Irish Bank) stymied by Brian Cowen as minister for finance?