Vol. 495 No. 2
38 Mr. Howlin asked the Minister for Finance the communication, if any, he has had in relation to inquiries being made into allegations made against National Irish Bank; and if he will make a statement on the matter. [19495/98]
The investigations into allegations made against National Irish Bank have been the subject of a number of communications and, in the absence of a clearer indication of what specifically the Deputy is looking for, I will list these. This may not be what the Deputy wanted but it is the only way I can answer the question. I should point out at the outset that, given the time available and the amount of searching which would be required to fully answer the Deputy's question, this list may not be exhaustive.
I have previously advised the House that, following the allegations concerning National Irish Bank and Clerical Medical International, I wrote to the Governor of the Central Bank on 26 January 1998 drawing his attention to the possibility that these could have exchange control implications. In that letter I also requested the Governor to make a separate report to me on the implications, if any, of the NIB developments for all aspects of banking supervision. The Governor acknowledged this letter on 28 January 1998.
The Governor replied to me on the supervisory aspect on 19 March 1998. He confirmed the Central Bank's inspection of NIB, which was conducted in its capacity as supervisor, had concluded but he was precluded by law from revealing the findings. Deputies will be aware that I have already read the text of the Governor's letter into the record of the House. In his letter, the Governor reiterated the comments made in his letter of 11 November 1997 concerning the supervisory issues arising from the McCracken tribunal, whereby he advised that the board was satisfied with its legal powers which are generally adequate to enable the bank to discharge satisfactorily its statutory functions. The board keeps supervisory procedures under review and tries to ensure they are in line with best international practice. Nothing in the bank's inquiries into the NIB-CMI issue led the Governor to change any of the conclusions he reported last November.
Further allegations against NIB concern the alleged application of charges on certain accounts over and above the standard charges these accounts should have attracted. The Central Bank is undertaking its own investigation into these new allegations. On 30 March 1998 I wrote to the Governor requesting his views on whether, following the result of the bank's current investigations, he would wish to revise any of his opinions regarding the adequacy of the legal framework for supervision set out in his letters of 11 November 1997 and 19 March 1998. The Governor replied on 31 March 1998, advising that when the Bank's current investigations are completed, he will write to me again. I have received no further communication on the matter from the Governor.
In preparing responses to parliamentary questions for answer on 3 March 1998 and 10 June 1998, I received certain advice from the Revenue Commissioners concerning their investigations into the allegations. The advice I received on those occasions is contained in the record of the House in the responses I gave to those questions.
In April this year my Department received for information a copy of a letter dated 29 April 1998 from Mr. Don Argus, managing director and chief executive officer of National Australia Bank, to the Taoiseach. In May I received a letter dated 1 May 1998 from Mr. Ross Pinney, managing director of National Australia Group Europe, outlining what he described as "progress to date" in relation to the group's internal investigations being undertaken into the allegations regarding National Irish Bank. I replied to that letter on 10 June 1998.
In relation to the possible exchange control aspects raised in my latter of 26 January, the Governor of the Central Bank responded to me on 28 May 1998 with a report on the outcome of its inquiry to date. This report was not conclusive. The Central Bank indicated it would pursue its contacts with NIB with a view to obtaining further clarification. It pointed out that it may emerge in due course that the findings of the other investigations under way may have exchange control implications and that it may be desirable to await the findings of these investigations before concluding its consideration of exchange control matters.
On receipt of the Central Bank's report, I sought legal advice from the Office of the Attorney General as to whether the report contained sufficient information in relation to possible breaches of exchange controls to warrant its referral to the DPP's office. Advice was also sought as to whether it would be in order to send a copy of the report to the Chairman of the Revenue Commissioners and to the Secretary General of the Department of Enterprise, Trade and Employment. Based on the legal advice received, it was considered the report was not sufficient to warrant its referral to the DPP. As the legal advice confirmed that it was in order to do so, my Department supplied copies of the Central Bank's report to the Chairman of the Revenue Commissioners and to the Secretary General of the Department of Enterprise, Trade and Employment.
On 29 July 1998, I received a letter from the inspectors appointed by the High Court on 30 March 1998 to investigate the affairs of National Irish Bank Limited, requesting a copy of the Central Bank's report. I replied to the inspectors on 30 July, indicating that I had directed that the report be forwarded to the Secretary General of the Department of Enterprise, Trade and Employment and that in so doing, I anticipated that a copy would be made available to the inspectors.
On 8 June 1998 my Department received a telephone message from the Department of Enterprise, Trade and Employment that the Tánaiste was in possession of the interim report of the authorised officer appointed to investigate the allegations and that no decision had been taken at that time concerning publication of that report. In June, my Department received a copy of a letter dated 26 June 1998 from the Department of Foreign Affairs to the Department of Enterprise, Trade and Employment, enclosing a letter dated 25 June 1998 received by the Irish Ambassador in Canberra from Mr. Don Argus. Also in July, my Department received a copy of a letter dated 29 July 1998 from the Department of Foreign Affairs to the Department of Enterprise, Trade and Employment, enclosing a report from the Embassy in Canberra concerning press items on a pending career move by Mr. Don Argus.
The intention in putting down the question was to discover information which had arisen since the Minister last answered questions in the House, but he has gone over material which was dealt with previously during Question Time. He will be aware that NIB will contend it was intended it would receive a copy of the interim report of the authorised officer. Can he confirm this has been done and explain why there was a delay in doing so?
The authorised officer does not report to me. He was put in place by my colleague, the Tánaiste and Minister for Enterprise, Trade and Employment, and she received a copy of that report. As I said in my reply, on 8 June my Department received a telephone message from that Department that she was in possession of the interim report and no decision had been taken at that time concerning its publication.
Is the Minister saying he does not have a copy of the report?
I do not.
Does he know whether it has been given to NIB? Clearly it has not been published.
That question will have to be put to the Minister for Enterprise, Trade and Employment.
I take it that means the Minister does not know.
I do not know. I did not go about finding out.
I accept the answer. In relation to the CMI issue, the Minister said that the Central Bank was in touch with him in March and indicated that it would get back to him later and that it contacted him again. I understand from the response that it was in June and that subsequently a decision was taken not to prosecute as there were not sufficient grounds. When was the decision not to prosecute made?
That decision would have been made by the Director of Public Prosecutions, not by me. The Governor of the Central Bank responded to me on 28 May with a report on the outcome of its inquiry to date. The report was not conclusive. On receipt of the Central Bank's report I sought legal advice from the Attorney General's office as to whether the report contained sufficient information in relation to possible breaches of exchange controls to warrant its referral to the Office of the Director of Public Prosecutions. Advice was also sought as to whether it would be in order to send a copy of the report to the Chairman of the Revenue Commissioners and to the Secretary General of the Department of Enterprise, Trade and Employment. Based on the legal advice received, it was considered that the report was not sufficient to warrant its referral to the DPP. As legal advice confirmed that it was in order to do so, my Department supplied copies of the Central Bank's report to the Chairman of the Revenue Commissioners and to the Secretary General of the Department of Enterprise, Trade and Employment.
I am genuinely confused. Was it or was it not referred to the DPP?
It was not referred to the DPP.
So the Department decided that there were not sufficient grounds to warrant prosecution.
I will take a final supplementary.
With respect, a Leas-Cheann Comhairle, I am genuinely trying to get information. I am not attempting to be argumentative in any way.
The Deputy has spent some time on this question and we would like to move on.
We have been so careful in the Department of Finance that we might appear to be going backwards. When we got that report we sought legal advice from the Attorney General's office as to whether the report contained sufficient information to warrant its referral to the DPP's office. On receipt of a reply from the Attorney General's office, it was not referred. We did refer it to the Chairman of the Revenue Commissioners and to the Department of Enterprise, Trade and Employment.
May I ask a final supplementary on a separate aspect of the Minister's response?
Yes. The reason I said it would be a final supplementary was in case there were other questions the Deputy wanted to ask.
This is in relation to the correspondence from National Australia Bank. Can the Minister indicate to the House the nature of that correspondence?
It was a letter sent from National Australia Bank's Mr. Don Argus to the Taoiseach's office. The Taoiseach's office sent us a copy of it. I am sure it can be made available under the Freedom of Information Act, but my recall of the letter, which I do not have here, is that it forcefully expressed the displeasure of National Australia Bank.
Since the Minister has introduced the issue of the Freedom of Information Act, perhaps he will let me have copies of the correspondence which he is satisfied will be covered by the Act.
I will have no difficulty in doing that.
Could the Chair advise me whether the time limit applies only to Priority Questions?
Yes, the time limit applies only to Priority Questions.
