IT IS far from the ideal start. Within 24 hours of the announcement that he was the new secretary general of of the Department of Finance, John Moran was on the back foot.

Through the department’s press office he was having to explain his role – or non-role – in an €11 million US banking scandal and also a five-year “gap” in his CV. The first seems to be something of a red herring and the second completely unrelated, but in truth both have some bearing on his suitability for the job.

Let’s look first at Moran’s time at Zurich Capital Markets (ZCM) and the scandal that resulted in it being fined $16.8 million by the US Securities and Exchange Commission. Between 1999 and 2003 ZCM’s New York office lent money to four hedge funds, which was used for fraudulent trades in mutual funds. The new secretary general is not implicated in the matters investigated by the SEC despite the best efforts of people - who clearly do not have Moran’s best interests at heart - to imply otherwise.

Moran was actually sent to New York from Dublin to close down the US operation, presumably on foot of the SEC investigation. This simple fact does speak volumes, as the SEC is unlikely to have approved of Zurich appointing to such a pivotal role someone who had a material involvement is the matters in question.

The suggestion that Moran had an involvement in any wrongdoing is thus groundless. But – and there is always a but – the brouhaha of last week has served to highlight an important question.

Moran was an honest investment banker, but he was an investment banker nonetheless, and does this militate against his suitability for his new job?

The story of Zurich Capital Markets is in many ways typical of what went wrong in global finance. Sleepy old Zurich, one of the world’s biggest, most conservative and boring financial institutions clearly felt it was missing out by not having any exposure to the fast-developing and very profitable alternative investment markets. The solution was to set up its own capital markets business in 1997 and it did so by hiring a handful of very bright financiers, including Moran.

By 2003 Zurich was trying to extract itself from the business and get back to the knitting – selling insurance and investment products. The extent to which what transpired in New York between 1999 and 2003 had a role in convincing Zurich that the new frontiers of finance were too rich for its blood is hard to discern. In any case, based on what happened in 2008, the Swiss insurance giant had a lucky escape.

While Moran may be blameless in respect of the SEC investigation, his role at Zurich made him a fully signed up member of the new financial alchemists who thought – wrongly – they had magicked away risk.

This is relevant to his new job, because he is now the unchallenged top dog when it comes to banking policy. It is reasonable to ask to what extent does he still view the world through such a distorted prism.

It is certainly the case that the “two pillar” banking strategy that he has implemented in his previous role as head of the banking section in the department is divisive. Its centrepiece, the decision to help Bank of Ireland avoid State control by facilitating an investment by North American investors is a case in point. It is too early to say whether the decision to trade off possible future gains for the taxpayer in return for the credibility brought through blue-chip investment has worked out. If the yardstick is a functioning banking system then Moran still has some work to do.

But before he can be lazily branded a wolf in sheep’s clothes, the other “controversial” part of his CV has to be weighed in the balance. This was his decision to take five years out in 2005 to live in semi-retirement in France and pursue a range of interests, including most notably setting up a chain of juice bars.

This offers some hope that Moran’s world view has evolved somewhat from the culture that permeated banking in the last decade and in many ways still does.

It is a controversial appointment, but let’s also not lose sight of the fact that the culture of the Department of Finance – into which he is now fully immersing himself – has its own very serious flaws and a very dangerous tendency towards groupthink. For that reason if no other the appointment of Moran is to be welcomed.