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Archive for September 12th, 2012

It has been six weeks since the Sunday Times revealed that a (former) NAMA employee had purchased a house and land in Lucan, west Dublin from a NAMA developer. There was outrage at the perception that the employee, Enda Farrell, might have obtained some advantage by virtue of his position in NAMA. This afternoon, NAMA has issued a statement telling us what it has done.

Most significantly, NAMA has taken High Court action against Enda Farrell – who is not mentioned by name in the NAMA statement incidentally – and Enda Farrell’s wife to recover information which NAMA believes may have been taken without authorisation from NAMA. The legal proceedings so far have been in camera which is why they weren’t picked up on here, but NAMA says that the High Court has ordered that Enda Farrell hand over data held on his computer and other storage devices. NAMA says it is now analysing that data. The matter has been transferred to the Commercial Court division of the High Court, and NAMA is not making any further comment on the proceedings themselves, not even saying what remedies it is seeking.

Of less significance perhaps is the investigation that NAMA commissioned its internal auditors Deloitte to undertake in the wake of the revelations at the start of August – these investigations have now concluded and NAMA claims that the property in Lucan was sold at a price which reflected an independent valuation and that Enda Farrell “had no role in the assessment or approval of the transaction by NAMA”

However NAMA also established that, contrary to NAMA’s requirement of full disclosure by staff in respect of the purchase of NAMA-related property, Enda Farrell did not disclose the transaction “at any time either prior to or following the transaction”. The NAMA board is currently examining the findings in Deloitte’s report and will consider if changes are required to NAMA’s internal procedures.

The full NAMA statement is here.

UPDATE: 12th September, 2012. Analysis:

The press release from NAMA this afternoon is intriguing. On one hand, the investigation into the sale of the property in Lucan to Enda Farrell is a damp squib. NAMA found that Enda didn’t disclose to it the fact he was buying it. However as far as NAMA is concerned Enda paid the market value, so didn’t gain any advantage. And whilst the NAMA board is still considering the results of the Deloitte investigation, it doesn’t look as if there will be any further action involving Enda on this matter.

However the bombshell was the fact that NAMA had uncovered what it claims was the inappropriate taking of information. NAMA went to the High Court and secured an Anton Piller order which allows the applicant to conduct a search without giving prior notice. They are rare enough in Ireland with perhaps one or two a year seemingly. It indicates a serious matter. NAMA doesn’t say what information might have been compromised or what remedy it is seeking at the Commercial Court where the matter will not be heard in open court. There is still no reference to the case on the Courts Service, but that may change tomorrow.

NAMA has also referred the information matter to the Data Protection  Commissioner and the Gardai. Again, it seems as if NAMA is being very robust here. It seems the Enda Farrell story is no longer about a property in Lucan but about the confidentiality of NAMA information. That’s a turn-up.

UPDATE: 21st September, 2012. The Irish Times reports that Ernst and Young has carried out an investigation and passed on the results to NAMA. And that Alice Kramer has resigned her position, “during the last few days”, it is understood.

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Last weekend, the communities of Ballyhea and Charleville in county Cork held their 80th weekly bank bailout protest, a dignified 15-minute modest display that demonstrates, for some at least in Ireland, they will not go quietly into the night and accept the 40% of GDP cost of the bank bailout being heaped onto the nation’s shoulders.

80 weeks is a long time, but in sunshine, frost, rain and in every other delight the Irish climate throws at us, they have maintained their weekly march which alternates between the town of Charleville and the village of Ballyhea. The photos chronicling their protest change with the hawthorn flowers of spring, to the lush green of summer, to the yellow-brown of Autumn, to frosty wintry mornings to be repeated again as long as it takes.

The protestors have varied their approach as they try to get the message across to a country which is traumatised by this crisis. They have cycled/run/walked/crawled from Ballyhea around Ireland to Leinster House to hand in a petition, there was a pilgrimage to the ECB itself in Frankfurt where they “nailed” our grievances – a copy of which is held aloft above by Vincent Browne on the Tonight with Vincent Browne show, screengrab courtesy of TV3 – to the door of the ECB HQ, this was followed by an appearance on the Vincent Browne show by one of the organisers, there was a fast and a sit-down protest on the main Cork-Limerick road. Where they could, they protested to An Taoiseach Enda Kenny himself (below in the black Mercedes). They have been joined by special guests along the way, most recently by Dr Constantin Gurdgiev, Deputy Stephen Donnelly, Caroline Simons and Declan Ganley. The protesters are not politically aligned, and their message resonates right across the political spectrum. They pay for everything themselves out of their own pockets.

The protest has been reported with a mixture of curiosity and pride in national and international media. The group has two Facebook sites, a blog and it maintains the bondwatch website which shows you what bonds are to be imminently paid in the state-guaranteed banks.

Seems like a lot of work, but what are they protesting about? They have been protesting at the repayment of bonds in Irish banks which to date have swallowed up €70bn of the nation’s wealth – this comprises €64.1bn given to the banks directly plus €5.6bn of state-aid given to the banks by NAMA whose bonds are guaranteed by the State. This represents 45% of our GDP or 55% of our GNP – a burden shouldered by no other country. The original focus of the protesters was bonds, particularly bonds which weren’t subject to a state guarantee and which weren’t secured against specific assets at the banks and which were repayable by utterly bust banks.

Why does it matter now? On 1st October 2012, AIB, a bank which is now 99.8% owned by the State – it would be 100% except the State wants to keep the shares publicly traded. AIB along with the tiddly EBS which merged with it last year have thus far received €20.7bn of the €64.1bn directly given to the banks. It has received another €1-2bn in state-aid from NAMA which paid a premium for the loans it acquired from AIB. By any measure, AIB is without the support of the State an utterly bust bank. And yet it is paying €1bn to bondholders who would be burned were it not for the State.

We will have one of the toughest budgets ever in December 2012, and with some economic projections deteriorating for 2013, we may have a similar budget in December 2013. Taxes will be increased and welfare and public sector costs will be cut – most of the adjustment results from an imbalance in our national finances after the property collapse, but a sizable portion is attributable to the bank bailout, so you can correctly point to the €1bn that will be paid by AIB on 1st October and compare that with tax increases or cuts to welfare and the public sector.

This coming Sunday will mark the 81st week of protest, and the communities have decided to extend the protest over three days to allow for protests in Cork and other counties and to conclude with a march on Tuesday 18th in Dublin from the national Garden of Remembrance at the top of O’Connell Street to Government Buildings where the Dail will be reconvening on the first day after the summer recess. The details and itinerary over the three days are here, they’d appreciate support along the way, a few minutes of your time to show that we are enlightened enough in this country to know how our money is being spent, and to protest at it being spent in utterly bust banks when the country is burdened with such austerity.

You can follow live developments on the protest with Diarmuid O’Flynn (pictured below on the Tonight with Vincent Browne show, screengrab courtesy of TV3) via Twitter here. The main Ballyhea protest site on Facebook is here. The bondwatch website with all bonds payable in Irish banks is here. The Ballyhea blog is here.

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Time to dust off your CVs as NAMA is hiring

At last count NAMA had 214 directly-employed* staff, a far cry from the 50-odd that the Agency was intended to have when it was conceived in 2009. In addition NAMA supports 400-500 staff at the so-called Participating Institutions – AIB, Bank of Ireland and IBRC. And of course NAMA supports an army of law firms, accountancy firms, public relations people, private investigators and receivers. In turn these companies employ armies of property managers and estate agents. At present the Agency has four vacancies, and you had better be quick because the closing date for applications is today and tomorrow.

The four vacant roles are (click on links to go directly to job description and application form)

(1) Legal advisor

(2) Asset Recovery Manager

(3) Asset Recovery Assistant Manager

(4) Asset Recovery Quality Assurance Manager

The closing date for the first role, the Legal Advisor, is today and for the three other roles, it is tomorrow.

This is what the NAMA organisation chart looks like at present, and asset recovery is supposed to be what happens after asset management.

It is not clear if NAMA is ramping up its asset recovery division, or if it is replacing departing employees. As is usual with such advertisements there is no salary given, though a large portion of the remuneration package is a generous pension. NAMA didn’t pay bonuses in 2011, and with the state of the nation’s finances, prospective employees should be cautious in their assumptions about bonuses in the immediate future. The NAMA CEO Brendan McDonagh is reported to take a close interest in recruitment, and prospective candidates can expect a rigorous selection process.

* all of NAMA’s directly-employed staff are in fact legally employees of the NTMA which is the umbrella organisation to which NAMA belongs

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