The scandal involving multimillion-euro loans provided to two Dublin-based solicitors has claimed its first casualty within financial institutions.
A senior manager at Irish Nationwide Building Society has been suspended over loans exceeding €20 million provided to Dublin-based solicitors Michael Lynn and Thomas Byrne.
Brian Fitzgibbon, Irish Nationwide's head of home loans, was suspended last week and is facing a disciplinary hearing at the building society's head office in Dublin next week.
Mr Fitzgibbon declined to comment yesterday. Informed sources said he has met legal advisers in Dublin and is planning to take a legal action against the society to stop the disciplinary proceedings against him.
The sources said Mr Fitzgibbon was claiming he has been made a scapegoat over the loans given to Mr Lynn and Mr Byrne, whose practices have been closed and who are being pursued in the courts by a large number of financial institutions over multimillion-euro loans.
It is believed Mr Fitzgibbon will claim he raised concerns about Mr Byrne's borrowings in April.
Mr Fitzgibbon has been in disagreement with the building society for several months. The loans to Mr Lynn and Mr Byrne have been raised as an issue in recent weeks. A spokesman for Irish Nationwide declined to comment.
Mr Byrne owes the building society €10.5 million; Mr Lynn owes more than €10 million.
The Irish Times has established the total known liabilities of Mr Lynn and Mr Byrne now stand at €127 million - Mr Lynn owes €79.5 million and Mr Byrne €47.5 million.
However, this could rise further, as Mr Lynn took deposits from investors through his overseas property business. Some borrowings drawn by Mr Lynn and Mr Byrne from other financial institutions have also not yet emerged.
Both men took out multiple mortgages from several institutions on the same properties by failing to register the securities on the loans, as they had undertaken to do.
Irish Nationwide is one of three, possibly four, financial institutions to have given Mr Lynn loans of more than €12 million to buy Glenlion House, a property in Howth, Co Dublin, worth €5 million.
Mr Fitzgibbon (41) became head of home loans, one of the most senior positions at the building society, in mid-2006, commuting to Dublin every day from his home in Thurles, Co Tipperary.
Prior to that, he was in charge of the building society's 52 branches, taking up this position in 2002. Before that, he was the society's assistant development manager. He joined Irish Nationwide after a spell at accountancy firm PricewaterhouseCoopers in the UK.
In a separate development, solicitor Barry Lyons of Dublin firm Lyons Kenny is suing Mr Lynn for failing to honour an undertaking on a property transaction in Co Leitrim that dates back to December 2003.
Mr Lyons launched his legal action last month over Mr Lynn's failure to fulfil the undertaking on the conveyancing of four properties in Carrick-on-Shannon.
Mr Lyons carried out the conveyancing on the properties on behalf of Mr Lynn. His case against Mr Lynn is due to be heard by the High Court today.
In the latest legal action taken against Mr Lynn, the solicitor was ordered by the High Court yesterday to repay €7.1 million to Anglo Irish Bank.
The Irish Times has also learned Mr Lynn has not revealed - in the court affidavit he filed on Monday - where the title documents for a substantial number of his 107 Irish properties are located.
The affidavit provides for the first time a comprehensive list of his properties in Ireland, Europe and the US.
It states that of his Irish properties, 30 title documents are held by the Law Society; 22 are with solicitors Matheson Ormsby Prentice (which is representing a receiver appointed over some of Mr Lynn's assets); and 12 are held by First Active, which lent money to him.