Ex-NIB executives dispute report's findings

A number of former senior NIB executives are disputing findings of a report that has triggered proceedings to disqualify them from acting as a director or senior company manager, the High Court heard yesterday.

The cases of the eight former executives, including former NIB chief executives Jim Lacey and Barry Seymour, were before Mr Justice Peter Kelly yesterday for consideration of a range of issues preparatory to the full hearing of proceedings brought by the Office of the Director of Corporate Enforcement.

The director, Paul Appleby, is seeking orders restraining the eight from being involved in the management of any company. He claims the eight, together with another former NIB executive who is not contesting the order, engaged in conduct in relation to the affairs of NIB which makes them "unfit to be concerned in the management of a company".

His application follows the publication in July 2004 of an inspectors' report into the tax evasion scandal within the bank in the 1990s. On Friday, the judge heard an application for a similar disqualification order against a ninth former executive, Nigel D'Arcy. The judge was told Mr D'Arcy, of Castledillon, Straffan, Co Kildare, a former head of financial advice and services at the bank, was not opposing the application. His counsel said there was "no denial of wrongdoing".

However, the judge said he wanted time to consider a number of legal issues and he reserved judgment.

When the cases of the eight other executives were mentioned yesterday, the judge was told by Brian Murray SC, for the director, that seven of the eight had filed substantial replying affidavits.

He said a number of the respondents were controverting the findings of the inspectors. One of them, NIB's former head of retail, Dermott Boner, of Chesterfield Avenue, Castleknock, Co Dublin, was looking for discovery of documents and other respondents wanted to bring similar applications.

Counsel said another of the eight - former regional manager Tom McMenamin, of College Grove, Castleknock, Co Dublin - had filed a shorter affidavit and was seeking to have the proceedings against him dealt with by way of plenary hearing.

Mr Murray said his side wished to file substantial replies to the respondents before the issue of a plenary hearing was adjudicated upon.

Colm Ó hOisín SC, for Mr Boner, said his client was looking for specific documents from NIB which were referred to in the inspectors' report. Mr Boner had retired in 1999 and did not have copies of those documents. The purpose of seeking discovery was so his client could set out his position on the issues raised in the report. Mr Boner was controverting the inspectors' findings against him.

Donal O'Donnell SC, for the inspectors, said Mr Boner had somewhat curiously sought discovery against the inspectors' only. Counsel said the inspectors believe the application raised "serious issues of principle".

Counsel for Mr McMenamin said they would be seeking time to put in a substantial replying affidavit. The judge remarked that time had been available since the end of July last.

The judge said he didn't have the replying affidavits before him and wished to study those and other documents before considering whether to permit motions for discovery or for a plenary hearing to be brought. He listed the cases for mention on Thursday, when he said he would consider all the issues raised.

The other respondents in the proceedings are: Mr Lacey of Pine Haven, Grove House Gardens, Blackrock, Co Dublin; Mr Seymour of Beaumond, Amersham, Bucks, England; former general manager of banking Michael Keane of Corr Castle, Howth, Co Dublin; former general manager of retail banking Frank Brennan of Ardglass, Dundrum, Dublin; former head of finance Patrick Byrne of St Helen's Road, Booterstown, Co Dublin, and former head of retail banking Kevin Curran, of Avondale Court, Blackrock, Co Dublin.

The proceedings arise following publication of the report of the inspectors appointed in 1998 by Tánaiste Mary Harney to investigate the affairs of NIB and NIB Financial Services Ltd between 1988 and 1998.

The inspectors concluded both NIB and NIBFS were involved in a number of improper practices, including the opening and maintaining of bogus non-resident accounts which enabled customers to evade tax, the improper charging of fees and interest to customers.

They also held that responsibility for the improper practices which existed rested with the bank's senior management during the 10-year period covered by the investigation.