‘Allegations’ prompted Central Bank inquiry into Siteserv sale, says governor

The Central Bank inquiry into the sale of Siteserv to Denis O'Brien by IBRC followed "allegations" made about the transaction, according to governor Patrick Honohan. The matter was now closed from the bank's perspective, he said.

Prof Honohan would not set out the nature of the allegations, nor would he say from whom they came. He also declined to say whether the investigation could be taken as a sign that the Central Bank believed at a prima facie level that there was something to the claims made.

Allegations

“Vague allegations are no use,” he told reporters. “But specific allegations can be followed and are followed up.”

However, Prof Honohan would not say whether the Central Bank investigated any other IRBC asset sales.

His remarks came days after former IBRC chairman Alan Dukes said IBRC submitted papers on the Siteserv deal and on the sale of an US apartment block known as Apthorp to the Central Bank because the Department of Finance "seemed to be upset" about the other sale.

Mr Dukes said the Central Bank ultimately had “no comment” on these matters.

In relation to Siteserv, Department of Finance records released under the Freedom of Information Act said the department was concerned that "IBRC consider the Central Bank of Ireland report compiled on the transaction vindicates their position".

Asked yesterday about the Central Bank investigation into the Siteserv sale, Prof Honohan said the matter was handled professionally at the appropriate level. He also disclosed it was only in recent days that he first received information internally about the investigation.

Transaction

“Following the receipt of specific allegations – so there are specific allegations – the Central Bank investigated this transaction,” Prof Honohan said. “No attempt was made to try to second-guess commercial decisions taken by the bank, so that means it didn’t say ‘oh, should they have got €50 million or should they only have got €40 million?’ or anything like that,” he added.

“Instead the Central Bank’s work focused on the integrity of IBRC governance processes and controls.” He said they considered the matter closed.