Michael Fingleton jnr fails to appear at INBS inquiry
Former executive at lender did not respond to attempts to contact him
Michael Fingleton jnr worked closely with INBS’s one-time UK head, Gary McCollum, who was based in Belfast, in managing the group’s UK €4.4 billion loan book up until early 2010.
Michael Fingleton jnr, son of the former managing director of Irish Nationwide Building Society (INBS), failed to turn up at a scheduled appearance before an inquiry into the now-defunct lender on Thursday.
Brian O’Moore, SC, of the legal practitioner team assisting the long-running inquiry into suspected regulatory breaches at INBS before its demise, said that Mr Fingleton jnr, who has not responded to repeated attempts going back to 2012 to help the inquiry. This includes efforts to secure his testimony, most recently by email last Friday.
This is despite the fact that Mr Fingleton jnr, who served as a top executive with INBS in London during the boom years and up until 2010, corresponded with the inquiry in recent months on the unavailability of his father to attend hearings due to ill health, he said.
“It’s simply unfortunate and unacceptable that Mr Fingleton jnr. . .has chosen not to respond or engage at all,” said Mr O’Moore. “It’s not just a lack of courtesy. . .as a former executive of the society, Mr Fingleton jnr simply isn’t prepared, for reasons which he has not specified, to attend today or at any other day that might be fixed.”
While Mr O’Moore said that it would be up to the three-member inquiry panel to decide on the next steps, its chairperson solicitor Marian Shanley said that as Mr Fingleton jnr is resident outside of the Republic, the inquiry hasn’t the power to summons him. He is based in London.
Mr Fingleton jnr worked closely with INBS’s one-time UK head, Gary McCollum, who was based in Belfast, in managing the group’s UK €4.4 billion loan book up until early 2010.
The inquiry also heard that Mr McCollum, who together with Michael Fingleton snr and INBS’s former finance director John Stanley Purcell, is subject to the ongoing inquiry, will not be available to give evidence by the time it adjourns for the summer break later this month.
Ms Shanley accepted a suggestion from Mr O’Moore to put off a scheduled appearance by Belfast-based Mr McCollum until September. Mr O’Moore said that there “always is the hope” that Mr Fingleton jnr would make himself available in the meantime.
The inquiry proceeded on Thursday with evidence from former INBS chairman Michael Walsh as it focused on INBS’s reliance on profit-sharing agreements with major developers that it funded before the property market crashed more than a decade ago.
It is alleged that these profit-sharing arrangements – which were linked to €6 billion of loans in 2008 – were not subject to a formal credit risk policy even though internal auditors and outside advisers had called for formal procedures to be put in place to cover such practices.
The inquiry heard last week that such agreements breached various guidelines and rules in the society, including policies that commercial property loans should not exceed 75 per cent of the value of a project, and that guarantors should back all such borrowings.
INBS routinely offered 100 per cent loan-to-value facilities to borrowers that were willing to share profits on projects with the society, while the borrowing entity often a special purpose vehicle (SPVs), did not provide guarantees, it is alleged.
Mr Walsh was asked on Thursday whether the board, which was obliged to decide on loans of more than €1 million, ever rejected credit proposals, including those with profit-share agreements, that were brought forward by management.
“Certainly there was discussion and debate, there would have been some adjustment in terms on some occasions,” he said. “But whether or not the board formally turned something down or it was withdrawn, I couldn’t tell you at this stage.”