The increasingly Stalinist nature of some aspects of Irish public life were on show in the Dail earlier this week when in response to a parliamentary question, the Minister for Finance Michael Noonan said that disclosure of the legal fees incurred by the Irish Bank Resolution Corporation – “IBRC”, the name of the new company that resulted from the merger of Anglo and Irish Nationwide last year – was “commercially sensitive”. However Minister Noonan kindly told us that legal fees make up part of the €260m of administrative and exceptional costs incurred by IBRC since the start of 2011. So legal fees incurred at an organization in which we own 100% of the shares range between nil and €260m in 18 months. Nice to know.
What makes this response even more bizarre is that one of IBRC’s competitors, NAMA publishes its legal costs every quarter and NAMA even publishes an annual budget for legal costs. And when it comes to legal expenses, you would expect NAMA and IBRC to be similar – both are trying to maximize recoveries on loans, both have gone to court in this country and elsewhere to pursue borrowers for outstanding loans. This year alone, NAMA has made 34 applications in Dublin’s High Court and has been on the receiving end of a further six. By contrast IBRC has made nearly 70 applications at the High Court, many of which have received no publicity, eg it is suing in separate actions top tier lawyers, BCM Hanby Wallace, Gerry Sweeney, Philip Conlon, Michael Fingleton and Ken Drumm – there is a full listing from the Courts Service above, accessible here. Of course there are two very high profile legal cases at IBRC – one against Sean Quinn and the Quinn family and the other against former CEO David Drumm whose bankruptcy in Boston is being vigorously challenged.
But why can’t we find out how much is being shelled out to lawyers? This is 100% our money, and IBRC’s competitor, NAMA readily discloses how much it spends. You might become suspicious that “commercially sensitive” is code for “it’s HUGE!”, in which case, all the more reason that we find out what IBRC is spending.
Remember IBRC is the asset management organization that looked cross-eyed at an Oireachtas committee which asked it if it monitored salaries at it borrower companies, this after it was revealed that hugely insolvent Siteserv was sold to interests associated with Denis O’Brien with a massive €100m writedown by IBRC on its €150m loans, and this as the same time as the CEO of Siteserv, Brian Harvey was being paid €401,000 per annum. But unlike NAMA, where there is strict scrutiny of borrower salaries, IBRC simply shrugged its shoulders and dismissed any concerns.
Minister Noonan’s was responding to a parliamentary question from the Sinn Fein party leader, Gerry Adams who coincidentally asked at the same time for the equivalent figures for NAMA and was told they were being collated and would be forwarded shortly! One rule indeed for NAMA and another entirely for IBRC.
The full parliamentary questions and responses are here:
Deputy Gerry Adams : asked the Minister for Finance the fees that are paid to companies who provide property valuations for the National Asset Management Agency; the fees for this service that were paid in each of the years since NAMA was established; the persons who were the top ten recipients of these fees in each of the years since NAMA was established.
Deputy Gerry Adams: asked the Minister for Finance if he will provide a breakdown of the legal fees paid by the National Asset Management Agency to date in 2012; if he will provide a breakdown of the recipients of those fees including the amount each recipient received from NAMA; and for the total legal fees incurred by NAMA since its establishment.
Minister for Finance , Michael Noonan: I propose to take Questions Nos. 229 and 230 together.
NAMA informs me that it cannot provide all the details requested by the Deputy in the time available. NAMA has undertaken to provide me with this information within the next week and, accordingly, I will issue a reply to the Deputy at that stage.
Deputy Gerry Adams: asked the Minister for Finance if he will provide a breakdown of the legal fees incurred by the Irish Bank Resolution Corporation in each year since its establishment.
Minister for Finance, Michael Noonan: I have been advised by IBRC that disclosure of this information is commercially sensitive. However, legal fees incurred by IBRC are included as part of Other Administrative Costs, or where applicable Exceptional Costs, as published in the Bank’s Annual Report & Accounts and Interim Report. The 2011 Annual Report & Accounts for IBRC show Other Administrative Costs of €108m and Exceptional Costs of €82m. However, these figures are not exclusively made up of legal fees. The H1 2012 Interim Report reflects Other Administrative Costs of €45m and Exceptional Costs of €25m.
Nama, and the rest of the €93 billion bank bailout, is little more than a Rolls Royce job and pension scheme for the upper husk professional classes in this country. Principally in the legal establishment.
I would estimate that this “bailout” will create of the order of 1000 additional millionaires in this country–at public expense. Or else make 1000 people that much richer.
Good work NWL.
There isn’t anybody else either on line or offline that manages to capture the extent and impact of the Irish financial black holes in real time like you do.
More power to your elbow.
:-)
the bigger scandal is that strange deal done with that shady Russian organisation to ‘recover’ the Russian Quinn assets and the apparent refusal by IBRC to entertain discussion with Corestate Capital, the Switz Private Equity fund who were allegedly interested in bidding. Thank God for the new religion of ‘transparency’, the country must have been an awful secretive place altogether before we discovered it!!!
This also doesn’t cover the IBRC litigation in the north which includes their multi-faceted battle with Peter Curistan and the Quinn litigation. The last Quinn hearing was a two-dayer which had on the IBRC payroll, among others, one of London’s top commercial silks and two partners from Tughans.