Irish Nationwide fined €50,000 over bank guarantee e-mail
The Financial Regulator today announced it had imposed a penalty of €50,000 on Irish Nationwide in relation to an e-mail circulated by the building society.
In a statement, the Financial Regulator said it had "reasonable cause to suspect that Irish Nationwide committed a breach of a regulatory requirement in relation to General Principle 1, Chapter 1 of the Financial Regulator’s Consumer Protection Code."
It added that this suspected breach relates to the circulation by Irish Nationwide of the e-mail on October 1st.
Minister for Finance Brian Lenihan had referred to the Regulator an e-mail circulated by the son of Irish Nationwide boss Michael Fingleton that sought new deposits, citing the protection of the Government's new bank guarantee plan.
The e-mail, received from financial sources in London, was sent by Michael Fingleton jnr to at least one leading global bank saying that, under the scheme, the society "represented the safest place to deposit money in Europe with a AAA guarantee from a country with the lowest national debt to GDP ratio of any AAA country".
The approach by Mr Fingleton jnr, who works in the building society's Wigmore Street office in London, flew in the face of Mr Lenihan's statement to the Dáil on Wednesday night in which he said he was determined to ensure that companies did not engage in anti-competitive practices if they were protected by the guarantee.
The Regulator said the it believed, through the sending of the e-mail, Irish Nationwide had failed to act professionally and with due regard to the integrity of the market. The Regulator reprimanded Irish Nationwide and imposed the penalty of €50,000.
Irish Nationwide apologised unreservedly and accepted that its behaviour was a breach of the Financial Regulator’s Consumer Protection Code.
Michael Fingleton was unaware in advance that his son would be sending out an e-mail soliciting new deposits on the back of the State guarantee scheme. The building society described the e-mail as "inappropriate and regrettable in the circumstances".
The Financial Regulator said the matter is now closed.