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22 April 2010 Edition

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Role of government-appointed directors at Anglo Irish questioned

Arthur Morgan

Arthur Morgan

Speaking in the Dáil on Wednesday evening on the Central Bank Reform Bill, Sinn Féin Finance spokesperson Arthur Morgan TD questioned why the two government-appointed Public Interest Directors on the board of Anglo Irish Bank signed a set of audited accounts which indicated the bank had made a pre-tax profit of €784 million, when it was common knowledge there was a problem with the bank, a fact only confirmed some weeks ago when the profit suddenly became a loss of €12.7 billion.  
Morgan told the Dáil:  “Minister you appointed two Public Interest Directors to the board of Anglo and from 11 Dec 2008 they had been attending Board meetings of the Bank. Frank Daly was appointed chairman of the Audit Committee of Anglo and Alan Dukes is now chairman designate of Anglo. You nationalised Anglo on 15 January 2009. Now I was under the impression that both these public interest directors were there to be our eyes and ears in Anglo.  
“Well if so I would like to know what they were doing in February 2009 when they actually signed, without so much as a murmur, a set of audited accounts for Anglo which indicated the bank had made a pre-tax profit of €784 million. Now lest we forget the dogs on the street knew there was a problem in this bank, a fact only confirmed some weeks ago when the Profit of €784 million suddenly became a loss of €12.7 billion.  “People deserve to know how these accounts were issued with the tacit approval of two government-appointed directors, showing a profit of €784 million when clearly there was no such profit.
“Furthermore, Mr Daly’s role as chairman of the Audit Committee in Anglo, where he presumably had some interaction with the bank’s auditors, Ernst & Young, who issued an unqualified audit report, makes this all the more bizarre.  
“But perhaps the most amazing contradiction in all of this is that Frank Daly, not long after signing a set of accounts showing a profit that never existed, becomes chairman of NAMA. And of course we all know what NAMA thinks of Anglo’s numbers  – total rubbish.  
“We must now ask, is it acceptable that an individual who, as a Public Interest Director, signs a set of financial statements for a state body stating there was a profit when there wasn’t, then becomes chairman of another institution that takes an entirely different view of those same set of numbers, culminating in a €12 billion loss the following year.  
“What purpose have these Public Interest Directors served? Do they contact you, minister, every month with a set of monthly management accounts to let you know how these businesses are doing? Do you talk to them? Did you talk to Frank Daly after he signed a set of accounts in February 2009 indicating a profit at Anglo Irish Bank? Did you believe him when or if he told you?”
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