Management at ACC bank did not treat the board of the State-run institution seriously, the DIRT inquiry has been told.
Ms Gary Joyce, a marketing consultant who was chairwoman of ACC from 1996 until April this year, told the inquiry that "from time to time" management kept information from the board. She said: "I think it's quite well known that, in my opinion, the board of ACC was not really treated by management as if it had a serious role to play in the running of the business."
She said she expected that board decisions would be implemented with no need to check them up. "Yet, repeatedly, decisions that the board made were not enacted", she added.
However, she conceded to the chairman of the Public Accounts Committee, Mr Jim Mitchell, that she never brought the issue of bogus non-resident accounts to the attention of the Department of Finance or the Minister. She said: "I had no facts and I had no information myself on which I could have a discussion with anybody about that."
Describing her experience as chairwoman as "unpleasant", she said, however, that it was her understanding that "the level of irregularities or non-compliance was significantly diminished, if not extinguished, by the time I stepped down as chairperson in April 1999".
She told Mr Pat Rabbitte TD that she was not on good terms with the management while she was chairwoman: "It was just a very difficult experience for me, personally. I mean, I think it's quite clear."
Ms Joyce said it was common knowledge that there was an element of non-compliance by ACC bank with respect to non-resident accounts. This was endemic throughout the deposit-taking financial institutions. It appeared to have arisen through a laissez-faire culture within banking that "if it was not tolerated by one's own bank then the depositors would simply remove their funds to another banking institution or outside the jurisdiction".
She said that the board had expressed "serious concern to management about the existence of bogus non-resident accounts" and as chairwoman she had directed management to take "remedial action" and had instigated a full investigation by the accountancy firm KPMG.
Ms Joyce told Mr Sean Doherty TD that when she was appointed "no difficulties at all" had been brought to her attention by management. She agreed that in hindsight it was "extraordinary" that she had not been informed about the non-resident accounts.
She became more concerned about compliance about 12 or 14 months after her appointment. Up to then she had "accepted management's assurances that there was no major problem with non-compliance and that these were isolated incidents".
She said that the chief executive had responsibility for briefing her as chairwoman. Asked if she was saying that he did not inform her of the level of non-compliance or that it was a major problem, she replied that it was the chief executive's view that it was not a serious problem, "that there was not a problem of non-compliance". Later on, her attitude was that it did not matter "whether these were sins of omission or commission", they needed to be sorted out.
She believed that the "culture" of the organisation, its history and background and the market forces which had affected it in the 10 years before she was appointed were responsible for "quite a lot of the issues".
