INBS inquiry resumes after Fingleton medical issues

An inquiry into the actions of four former Irish Nationwide Building Society (INBS) senior managers in the lead-up to the financial crisis has resumed public hearings, following a six-week delay caused by medical issues relating to one of the men, former society managing director Michael Fingleton.

The inquiry, looking into seven suspected regulatory breaches at the now-defunct lender, heard on Tuesday that Mr Fingleton, who turned 80 last month, applied on four occasions since early January to adjourn hearings “on medical grounds”. Attendees at the first public session relating to the case since before Christmas did not hear details of Mr Fingleton’s condition.

However, Mr Fingleton, who led INBS from 1971 until his retirement in 2009, was in attendance on Tuesday, alongside the lender's one-time finance director, John Stanley Purcell, who is also subject to the investigation.

The inquiry's three-member panel, led by chairwoman Marian Shanley, was told that the other two men accused of being involved in the case – Tom McMenamin, a former commercial lending manager, and Gary McCollum, who once led the society's UK lending activities from a base in Belfast – have not engaged with the investigation since well before public hearings began last December.

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The investigation had also been looking into the actions of former INBS chairman, Michael Walsh. However, Mr Walsh reached a settlement earlier this month with the Central Bank where he was fined €20,000 and disqualified from managing any regulated financial service provider for three years.

Loan approvals

The inquiry is looking into allegations that at least some of the four remaining men under investigation failed to ensure that commercial loan applications were processed and approved correctly. It is also alleged by the Central Bank that the executives failed to ensure commercial lending was effectively monitored in line with internal practices.

The first module of the hearings, currently under way, centres around a so-called fifth suspected prescribed contravention: the role of the credit committee during the period under investigation, between August 2004 and September 2008.

The panel heard on Tuesday from its first witness, Darragh Daly, who served on different occasions as INBS’s home loans manager and credit risk manager. Mr Daly said that he did not recall documents being circulated ahead of regulator credit committee meetings.

Mr Daly also said that the only thing he remembered being discussed during credit committee meetings that he attended were cases of loans up for approval. He said that he didn’t recall other items, such as cases of large arrears on commercial loans, being reviewed during the meetings he went to.

Mr Daly is due to be questioned on Wednesday by Mr Fingleton and Mr Purcell, who are representing themselves in the inquiry, which has the power to impose fines of up to €500,000 on individuals.