The Director of Corporate Enforcement (DCE) is seeking a High Court order disqualifying a former senior manager with National Irish Bank (NIB) from involvement in the management of a company arising from findings in the report of the inspectors who investigated the tax evasion scandal in NIB in the 1990s.
John Francis Brennan, known as Frank Brennan, is opposing the application and denies he failed seriously in his duties.
The application opened before Mr Justice Roderick Murphy yesterday and arises from the report of the investigation by the inspectors into the affairs of National Irish Bank and National Irish Bank Financial Services Ltd (NIBFS).
Their report concluded that NIB and NIBFS were involved in a number of improper practices including bogus non-resident accounts to evade Dirt, the promotion of secure investment policies not declared to the Revenue and improper charging of interest and fees to customers.
The report found that Mr Brennan, of Ardglas, Dundrum, Dublin, while he was a senior director of NIBFS in the 1990s, had responsibility for ensuring there was a system in place for compliance with the Dirt regime. The inspectors found he failed to inform branches prior to 1995 of the requirements relating to Dirt-exempt non-resident accounts and to ensure that accounts classified as such complied with statutory regulations.
In a replying affidavit, Mr Brennan said it was unfair and unreasonable to attribute responsibility to him for "the malpractices of branch managers" who were also identified in the report. He, of necessity, placed a high degree of trust in branch managers who were appointed by regional managers to carry out their responsibilities in an appropriate manner.
He said his actions were reasonable having regard to the information in his possession at the time. The belief of the inspectors that he should have been aware that bogus non-resident accounts existed throughout the bank network was "not well-founded".
The disqualification proceedings have been brought under Section 160 of the Companies Act, 1990. The director has brought similar proceedings against eight other NIB executives or managers.
