“I am also advised that NAMA already employs a wide range of measures to prevent unauthorised disclosure of confidential data. These include practical measures such as the deployment of e-mail monitoring technology to prevent e-mail attachments from being forwarded to personal and non-corporate e-mail accounts. IT controls also ensure that data cannot be saved from the National Treasury Management Agency, NTMA, network on to external storage devices such as USB keys, CDs, etc.” Minister for Finance, Michael Noonan making a statement on NAMA during questioning in the Dail by the Fianna Fail finance spokesperson Michael McGrath on 25th September, 2012
It should be clearly said that all the former NAMA employee, Enda Farrell faces up to now are allegations by NAMA which are set to be heard in the Commercial Court division of the High Court in October 2012, though it should be said that the case is not yet listed on the Courts Service website. In addition, NAMA says that it has referred a matter to both the Gardai and the Data Protection Commissioner. Some commentary might suggest that Enda has been tried, judged and convicted but that is not the case at all, and the courts will go about their work to decide on the matter. Having said that, it is to be expected that some will conclude at this stage that there is no smoke without fire and assume the worst. But let’s remember the man and his wife – Enda Farrell and Alice Kramer – are innocent until otherwise established, and they are entitled to their good names pending the outcome of the court case and any Garda/Data Protection investigation. So we should all be careful with our comments and that includes Minister for Finance Michael Noonan who told the Dail yesterday that “it is unfortunate that in spite of these wide-ranging controls and obligations, NAMA has suffered a breach of trust”
Yesterday in the Dail, the Fianna Fail finance spokesperson Michael McGrath questioned the Minister for Finance Michael Noonan on the Enda Farrell affair, NAMA’s investigations and potentially negative consequences for NAMA and the taxpayer. You might recall that the usually even-tempered Deputy McGrath called for a Garda investigation as soon as the Sunday Times broke the story of Enda Farrell buying NAMA-related property on 5th August, 2012, though remember at that stage there was no obvious issue with the unauthorised removal of information. Yesterday Deputy McGrath criticised NAMA for not referring the matter to the Gardai in August, and it appears that the referral may only have taken place on 12th September 2012 when NAMA referred the matter to the Data Protection Commissioner. Deputy McGrath may be concerned with the potential loss of evidence which would not have occurred had the Gardai immediately been called in. Minister Noonan defended NAMA and its controls including its IT controls, though these would appear to have failed if NAMA’s allegations against Enda Farrell are correct.
Not for the first time, Deputy McGrath called for the practice of NAMA selling property off-market to be stopped. Deputy McGrath said “the practice of NAMA engaging in the private sale of assets under its portfolio without putting those properties up for sale in the open market stinks. It needs to come to an end. Will the Minister make that one practical change immediately?” Remember that two properties – both landbanks in and around Cork city – have been sold by NAMA or its representatives or developers without first coming onto the market. Minister Noonan again had no answer to these concerns.
The exchange in the Dail was brief but there were several parliamentary questions on the affair yesterday. The PQs are still being uploaded by the Oireachtas staff to the Oireachtas website but at time of writing, these are the only ones available that pertain to the Enda Farrell affair. You might recall that Enda Farrell’s wife, whose name is Alice Kramer, worked for Ernst and Young – it was reported last week that she had resigned from that firm a few days previously – and NAMA has an extensive relationship with Ernst and Young. The company is on NAMA’s panel for advising on the sale of loans, is on the panel to review debtor/developer business plans and is also a receiver which NAMA has had appointed to several of its developers’ companies where E&Y is charged with managing assets including disposing of them. The questions below are all from the Sinn Fein finance spokesperson Pearse Doherty to the Minister for Finance Michael Noonan.
Deputy Pearse Doherty: asked the Minister for Finance in relation to the alleged unauthorised disclosure of information at the National Asset Management Agency by a former employee, the controls NAMA has in place to ensure that the provision of loan advisory services by Ernst and Young is not compromised as a result of the alleged unauthorised disclosure of information.
Deputy Pearse Doherty: asked the Minister for Finance in relation to the alleged unauthorised disclosure of information at the National Asset Management Agency by a former employee, the number, original book value, sales status, sales value, sale completion dates of loan portfolios that in relation to which NAMA has engaged Ernst and Young to provide loan advisory services.
Minister for Finance, Michael Noonan: I propose to take Questions Nos. 107 and 108 together.
I understand that there has been full co-operation between NAMA and Ernst and Young in the investigation of this matter.
More specifically to your question, I am advised by NAMA that it has not to date deployed the firm of Ernst & Young as an adviser on potential loan sales transactions.
NAMA further advises that when making an appointment from the loan sales advisory panel, it is normal practice to invite three firms from the framework panel to participate in a mini-tender so as to minimise the transaction cost to NAMA. Before receiving any detailed information relating to the particular transaction involved, firms are required to confirm that they have no conflict of interest. A breach by any firm under this requirement would result in that firm’s disqualification from future assignments awarded by NAMA and would clearly give rise to significant reputational issues for the firm concerned.
Deputy Pearse Doherty: asked the Minister for Finance in relation to the alleged unauthorised disclosure of information at the National Asset Management Agency by a former employee, the number of companies to which Ernst and Young has been appointed as receivers at the behest of NAMA.
Deputy Pearse Doherty: asked the Minister for Finance in relation to the alleged unauthorised disclosure of information at the National Asset Management Agency by a former employee, if he will provide the value of disposals made by Ernst and Young of assets to which NAMA had that company appointed as receiver.
Minister for Finance, Michael Noonan: I propose to take Questions Nos. 109 and 110 together.
I am advised by NAMA that it has appointed Ernst & Young as receiver to 18 separate corporate entities across four NAMA debtor connections. I am advised that, to date, no asset realisations have taken place under these appointments. I understand that Ernst and Young was appointed by a syndicate of banks as administrator to Battersea power station and that NAMA recovered full debt through the sale of this asset.
UPDATE: 30th September 2012, the journalist who originally broke the story of Enda Farrell buying a NAMA-related property, today reports that Enda has lost his job at his new employers, Forum Partners. John Mooney at the Sunday Times (behind paywall) reports that Enda has been “sacked from his new job”