Sunday, July 26, 2015

26/7/15: That Seagull Flock Model of Public Governance: The Banking Inquiry


Second, following the previous post on Nama, is the Banking Inquiry news:

The Banking Inquiry also has now adopted the Seagull Model for public transparency and governance: there are scandals and tantrums left, right and centre of the political spectrum. The gig is, of course, less of a maritime evocation as it is with Nama, and more of the landfill nature, but you get the picture.

Some chronology on the matters at hand:

  • Back in mid-July there were reports that a whistleblower - someone working for the Inquiry - came forward in April 2015 with the allegations that "relate to alleged preferential treatment which the whistleblower feels was given in the workings of the investigation team to the Central Bank and the Department of Finance. It is suggested the Central Bank insisted on a whole series of redactions in documents that it supplied. It is also being suggested that the Central Bank, at a critical point, was allowed a lengthy meeting with the lead investigator." Now, for those who do not know this, the Inquiry has two teams of 'advisers' - one that goes over submitted evidence and distills it to the members of the Inquiry - as far as we know, that team is composed of the Oireachtas employees - and another that prepares questions to be put forward by the members - which includes former banks and finance sector employees. Note: this is an important bit for the subsequent link on the matter from today.
  • Sunday Times a week ago also carried some details of the whistleblower allegations, specifically alleging that a number of undocumented meetings took place between the Central Bank, Nama and senior investigators on the banking inquiry. Other sources also include Department of Finance into the august list of entities allegedly granted unprecedented access to pre-brief the inquiry investigators. The same Sunday Times article also claims that: "It is understood allegations have also been made to Marc MacSharry, a Fianna Fail senator and inquiry member, that a second investigator quit the banking inquiry team on May 13 this year, citing concerns similar to those raised by the whistleblower."
  • Check the timeline: April 27 whistleblower allegations filed, May 13 another Inquiry official resigns on similar concerns, July 15 whistleblower allegations are leaked to press, July 23 inquiry into allegations set up. Things become swift, in Ireland, only after the media gets the news. Never before.


    • So on foot of the publicly leaked allegations, it was decided to do the most Irish of All Things and… hold and Inquiry into the Banking Inquiry.  As an aside, while the previous FF/GP/PDs governments can be collectively accused of having Leadership by Quangos fetish, the current one can be assigned a monicker of Leadership by Inquiries.
    • And, in a typical Irish fashion, the Inquiry into the Inquiry (shall we call it IiI here?) will have terms of reference that will include hunting down the wrongdoing of leaking the allegations to the media. As reported here: "The Oireachtas tonight released the terms of reference for Mr Allen’s investigation. He will investigate allegations that false information was given to Oireachtas Committee members, and preferential treatment was given to certain witnesses. The investigation will also look at alleged conflicts of interest that it is claimed were not appropriately handled by the inquiry’s investigation team. Mr Allen will also be required to examine the allegations in the context of the legislation underpinning the Bank Inquiry. The leaking of information to a journalist named by the whistleblower will also form part of the investigation." We can get a good sense of where the findings will go: a new battle between politicos and journos. There will be war… 
    • But, fear not: we already have one outcome of the whistle blowing scandal: the whistleblower has been punished. Per same report "The whistleblower’s pay has been suspended since last week after, it is claimed, they refused a transfer from a section within the Banking Inquiry." That should teach everyone a lesson: Ireland tolerates no whistle blowing. Never did and never will. Get over it, folks, and keep on pretending we have a modern society with all the trappings of transparency and ethics. This was confirmed in the Irish Times report here: "After the allegations were made, the whistleblower claims that their duties as an investigator were transferred on April 27th. A “false announcement of my resignation” was made during the week beginning June 1st, and their desk was cleared. Notification of their salary being suspended was received on July 15th."
    • Of course the irony is that back in March, the Inquiry heard from Dr Elaine Byrne that whistleblowers need not only be protected, but rewarded for their actions. Ah, yes… back to Ireland, thus...



    • Last week, the Irish Times carried some select excerpts from the whistleblower communication. These are worth reading: "The whistleblower claims that the terms of reference for a review of the allegations to be carried out for the Houses of the Oireachtas Service by Senior Counsel Senan Allen while including consideration of the claim that certain participants received favourable treatment do not detail or substantiate the allegations which include “off-the-record telephone calls and meetings” and “improper pressure on certain investigators to exclude certain relevant witnesses”.” It is also alleged that there was “significant ongoing and detailed leaking of information by a certain investigator” to a national newspaper. And the whistleblower claims that they were “routinely instructed to disregard redacted material” emanating from an unnamed institution, which “in my view could have proven to be extremely relevant to the proper processing of the investigation”. The “instructions were relayed to me by superiors and included instructions to inform the Joint Committee of Inquiry that participants had complied with matters related to compelled documentation, when in my view, participants were not compliant”. The “participants” are believed to be the Central Bank of Ireland and the Department of Finance." And further: "The whistleblower claims they were prevented from engaging in “basic investigative work and from exploring valid lines of inquiry”. “I am extremely concerned that the timeframe given to Senan Allen to conduct this investigation will ultimately lead, particularly in light of the limited terms of reference and in conjunction with the limited term period for a review, to a sub-standard and wholly inadequate review that will not broach the complexity of the allegations raised by me,” the whistleblower added. “Furthermore, the terms of reference are silent on the requirement to investigate the origin, publication and distribution of the false and defamatory statements made about me in an official report dated May 6th produced by the Houses of the Oireachtas service.”


    All of this brings us to the latest round of revelations from the Banking Inquiry published today in the Indo. Ah, the pearls include:

    • That "Morgan Kelly, Professor of Economics at University College Dublin, who notably predicted the property collapse, has turned down an invitation to appear before the inquiry." Frankly, why am I surprised? Why would anyone be surprised. Morgan is a serious scholar and has little time for the farcical performances. 
    • And then there is the controversy over political hissy fits triggered by the offer from David Drumm to testify on the matters of his recollection of the meetings with former Taoiseach Brian Cowen. Which I covered yesterday here.
    • For the last bit, the juiciest fare so far: "…the whistleblower has claimed this investigator, who was deciding what documents from the banks should be entered in evidence, secured a new job with the Bank of Ireland while working for the inquiry. The whistleblower was "shocked" when it was decided to allow the investigator work out his notice period with the same access to bank documents after he had accepted the Bank of Ireland job offer." 
    Oh dear… Where does one go from this? To 2016 headlines about some Inquiry staff getting cushy jobs in the state bodies with allegedly cushy relationships with the Inquiry?.. What is next for the Cosy Planet 'Ireland'?

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