Dáil Éireann Debate, Tuesday - 18 September 2012
268. Deputy Pearse Doherty asked the Minister for Finance the principal person or persons at an audit firm (details supplied) who was or were responsible for the audit of the financial statements for the year ended 30 September 2008, of the bank formerly known as Anglo Irish Bank which is now 100% owned by the State. [38304/12]
Amharc ar fhreagra270. Deputy Pearse Doherty asked the Minister for Finance the steps taken by the bank formerly known as Anglo Irish Bank to seek redress from an audit firm (details supplied) in respect of any failure to identify irregularities in the financial statements for the year ended 30 September 2008. [38306/12]
Amharc ar fhreagra271. Deputy Pearse Doherty asked the Minister for Finance the steps taken by him or agencies acting under his aegis to seek redress from auditors (details supplied) in respect of any failure to identify irregularities in the financial statements for Anglo Irish Bank. [38307/12]
Amharc ar fhreagraI propose to take Questions Nos. 268, 270 and 271 together.
As the Deputy is aware the company referred to in the question, chartered accountants and registered auditors, conducted the audits of the relevant financial statements of Anglo Irish Bank Corporation for the year ended 30 September 2008. I have been informed that the bank is not in a position to positively identify all the principal persons at that company who were responsible for the conduct of the audit.
The Deputy will be aware that the Chartered Accountants Regulatory Board (CARB) appointed Mr John Purcell to conduct an independent enquiry into certain matters relating to their conduct as auditors of Anglo. The Statement issued by CARB following his investigation is attached. Mr Purcell also carried out an investigation into the conduct of Mr Sean Fitzpatrick, Mr William McAteer and Mr David Drumm, all officers of Anglo and members of CAI. The Statement issued following the investigation is attached.
In all cases Mr Purcell concluded there was a prima facie case. The next step in the process is for CARB to hold public Disciplinary Tribunals. However, these have been stayed following a request from the DPP who was concerned that the CARB prosecution of any of these cases could prejudice the criminal enquiry against the individuals or the firm named above arising from the various investigations carried out by the Garda and Regulatory Authorities.
The bank has also advised me that it is actively investigating all legacy issues with a view to taking appropriate action to resolve such issues. Due to the sensitive nature of those issues, it would be inappropriate for the bank to comment further on the subject matter of the question at this time.
Statement issued in accordance with Bye-Law 19.8 of the Disciplinary Bye-Laws of Chartered Accountants Ireland by the Complaints Committee of the Chartered Accounts Regulatory Board (CARB)
A meeting of CARB’s Complaints Committee took place on 13th September 2011 at which the Report of Special Investigator, Mr John Purcell, concerning his investigation into Institute Member firm, Ernst & Young, in respect of their former role as auditors to Anglo Irish Bank, was considered.
In his Report to the Complaints Committee, Mr Purcell certified that, in his opinion, there existed certain prima facie cases against the member firm.
The Complaints Committee referred those prima facie cases to CARB’s Disciplinary Panel by way of Formal Complaints under the provisions of Bye-Law 19.6 of the Disciplinary Bye-Laws of Chartered Accounts Ireland.
The Special Investigator certified that in his opinion there were prima facie cases against Ernst & Young in respect of their role as auditors to Anglo Irish Bank in respect of the following:
1. Their failure to detect the scale of Mr Sean FitzPatrick’s loans and their systematic refinancing over year ends and the lack of appropriate disclosure in the first set of Anglo’s Financial Statements for the year end 30th September 2008, which were signed on 2nd December 2008, or in Ernst & Young’s audit report thereon;
2. Their failure to refer to the transactions in September 2008 between Irish Life & Permanent and Anglo in their audit report on the first set of Anglo’s 2008 Financial Statements, in the absence of appropriate disclosure in those 2008 Financial Statements;
3. Their failure to ensure appropriate disclosure of a loan made to Mr William McAteer, a Director of Anglo, in the first set of Anglo’s 2008 Financial Statements or in their audit report thereon.
The Special Investigator certified that in his opinion there was no prima facie against Ernst & Young in their role as auditors to Anglo Irish Bank in respect of the following:
1. The manner in which they dealt with the September 2008 transactions between Irish Life & Permanent and Anglo in their audit report on the second set of Anglo’s 2008 Financial Statements, which were signed on 19th February 2009;
2. Their lack of awareness of the so-called “Maple 10 loans” when they issued their audit report on the fist set of Anglo’s 2008 Financial Statements;
3. The manner in which they deal with the so-called “Maple 10 loans” in their audit report on the second set of Anglo’s 2008 Financial Statements;
4. Their lack of awareness of the alteration of recourse terms on certain loans to four key management personnel of Anglo when Ernst & Young issued their audit report on the first set of Anglo’s 2008 Financial Statements.
For more information contact:
Paul Daly
Communications Executive,
Chartered Accountants Regulatory Board.
Ph: 087-2235187
E: paul.daly@carb.ie
Statement by the CARB Complaints Committee regarding the report of the special investigator
Statement issued in Accordance with Bye-Law 72.8 of the Bye-Laws of Chartered Accountants Ireland by the Complaints Committee of the Chartered Accountants Regulatory Board (CARB)
A meeting of CARB’s Complaints Committee took place on 14 December 2010 at which four Reports of Special Investigator, Mr John Purcell, were presented. In his Reports to the Complaints Committee, Mr Purcell certified that, in his opinion, there existed certain prima facie cases that Institute members, Mr David Drumm, Mr Sean FitzPatrick, Mr William McAteer and Mr Peter Fitzpatrick, were liable to disciplinary action under the Buy-Laws of Chartered Accountants Ireland.
The Complaints Committee referred those prima facie cases to CARB’s Disciplinary Committee by way of Formal Complaints under the provisions of Bye-Law 72.6 of the Bye-Laws of Chartered Accountants Ireland.
The prima facie cases certified by the Special Investigator in relation to each member as follows:
Mr David Drumm
The Special Investigator certified that in his opinion there was a prima facie case in respect of the following:
1. His role in relation to the temporary transfer of loans of Mr Sean FitzPatrick and their non disclosure in the financial statement of Anglo Irish Bank.
2. His role in relation to the transactions between Anglo Irish Bank and Irish Life and Permanent plc at key reporting dates in 2008.
3. His role in relation to the amendment of the terms of the loans made to ten customers of Anglo Irish Bank Corporation Limited for the purchase of shares in Anglo Irish Bank.
4. His role in relation to certain loans made to four key management personnel.
5. His role in relation to a loan made to Mr William McAteer in 2008.
The Special Investigator certified that in his opinion there was no prima facie case in respect of the following:
1. His role in relation to the loans made to ten customers of Anglo Irish Bank for the purchase of shares in Anglo Irish Bank.
Mr Sean FitzPatrick
The Special Investigator certified that in his opinion there was a prima facie case in respect of the following:
1. His role in relation to the temporary transfer of his own loans and their non disclosure in the financial statement of Anglo Irish Bank.
2. His role in relation to the transactions between Anglo Irish Ban and Irish Life and Permanent plc at key reporting dates in 2008.
3. His role in relation to a loan made to Mr William McAteer in 2008.
The Special Investigator certified that in his opinion there was no prima facie case in respect of the following:
1. His role in relation to the loans made to ten customers of Anglo Irish Bank for the purchase of shares in Anglo Irish Bank.
Mr William McAteer
The Special Investigator certified that in his opinion there was a prima facie case in respect of the following:
1. His role in relation to the temporary transfer of loans of Mr Sean FitzPatrick and their non disclosure in the financial statement of Anglo Irish Bank.
2. His role in relation to the transactions between Anglo Irish Bank and Irish Life and Permanent plc at key reporting dates in 2008.
3. His role in relation to the appropriate disclosure of a loan made by Anglo Irish Bank to him in September 2008.
The Special Investigator certified that in his opinion that was no prima facie case in respect of the following:
1. His role in relation to the loans made to ten customers of Anglo Irish Bank for the purchase of shares in Anglo Irish Bank.
2. His role in relation to a loan made by Anglo Irish Bank to him in September 2008.
Mr Peter Fitzpatrick
The Special Investigator certified that in his opinion there was a prima facie case in respect of the following:
1. His role in relation to the transactions between Anglo Irish Bank and Irish Life and Permanent plc at key reporting dates in 2008.
For Enquiries contact paul.daly@carb.ie.ie or on 087-2235187
