IRISH BANKS have lost 90 per cent of their value and the Financial Regulator has seen its chief executive retire early, yet the watchdog monitoring them has not met for more than five months, it has emerged.
The last meeting of the consumer consultative panel of the Financial Regulator was held on September 9th, 2008, the Department of Finance has confirmed. That committee’s term expired in mid-October and it took more than three months before Minister for Finance Brian Lenihan appointed a new panel last month.
The delay in appointing a new panel, and the failure to consult consumer interests during the financial crisis, has angered some members.
"It was noticeable during the crisis that industry had the ear of the Department of Finance and the regulator but consumers were nowhere to be seen," one told The Irish Times.
He said many of the issues raised by the panel had “crystallised” in the current crisis. “We told them they had to prepare for a downturn, we criticised the speed at which they operated and we expressed opposition to a ‘tick box’ approach to fitness and probity in financial institutions.”
The regulator has so far failed to publish the latest report by the panel on its performance; in previous years, these have been highly critical of aspects of its operations.
The author of the report, panel member and finance lecturer John Maher, said he wished it had been published some time ago but he understood the regulator must first make a formal response. This could not happen until a new panel was appointed and had met.
Mr Lenihan has now appointed 11 members, from a possible 20, and says he will consider further appointments later. He has also increased the term of membership from two years to three.
Membership, which includes representatives of the Consumers’ Association of Ireland, St Vincent de Paul and Immigrant Council of Ireland, is broadly similar to the previous panel and consumer lawyer Raymond O’Rourke has been re-appointed as chairman.
A separate industry panel has also not met for more than five months. It also took more than three months to appoint 20 members to this panel, which will be chaired by David Went, chairman of The Irish Times Ltd and former chief executive of Irish Life and Permanent.
The statutory function of the consumer panel is to monitor the performance of the regulator and to provide the regulator with comments on the performance of the financial services industry.
Its first chairman, Brendan Burgess, resigned in 2007 after tensions arose with the regulator. The panel’s 2006 review criticised the slow response of the regulator to consumer issues, saying it “communicates with such caution that it gives the impression that if it can find a reason not to act, this will be the preferred outcome”.
It also complained that the panel, and by extension consumers generally, have no information on enforcement activity.
