THE IRISH LEAGUE OF CREDIT UNIONS A.G.M: A senior Department of Finance official stood down from the board of the Irish League of Credit Unions (ILCU) immediately after his election yesterday, claiming that he had been threatened.

Mr Tony Smyth is a former general secretary of the ILCU although he was never a member of its board until a ballot at its annual meeting this weekend.

He was elected on the first count. But immediately after his election, he is understood to have said in a prepared statement to delegates that he was unable to take his place on the board due to what he claimed were threats contained in an e-mail.

The nature of the threats was not disclosed and Mr Smyth indicated he would pursue the matter legally. It is thought the e-mail refers to personal and business matters.

Referring to the alleged threats, the league's newly elected president, Mr John O'Regan, said: "It is sad to see such conduct taking place within the credit union movement. On behalf of the board and all credit unions I totally condemn this conduct."

Mr Smyth's statement is said to have surprised delegates, who spent part of the a.g.m. discussing a report by consultant Mr Phil Flynn which said the board was dysfunctional.

The movement is divided and a number of credit unions have threatened to leave altogether if it does not reform. Certain informed figures believe current tensions are akin to "civil war" in the movement.

The Irish Times was unable to contact Mr Smyth last night. He resigned the post of general secretary last January by mutual agreement with the board. He returned to the Department of Finance from which he had been on secondment.

Although the circumstances of his resignation have never been explained, his departure followed the cancellation of a major computer project after expenditure of more than €34 million

Mr O'Regan's predecessor, Mr Jim McMahon, declined to disclose the conditions of Mr Smyth's termination agreement. Mr McMahon said he had signed the agreement and that it contained a confidentiality clause.

He added: "It strikes me as odd that in a movement where confidentiality is something we live with in our credit unions on a daily basis people should persist in seeking to have this clause put aside." Mr O'Regan was elected despite Mr Flynn's recommendation to end the practice of deputy presidents invariably succeeding presidents.

In a statement, he said: "The commission highlights the need for radical change. There is now clear need for greater transparency and accountability to build the appropriate levels of trust in the movement."

Mr Flynn and the members of his review commission spoke for almost two hours to the a.g.m. on Saturday afternoon.

While journalists were excluded from the meeting, it is understood that certain delegates asked whether the recommendations of Mr Flynn's report would be implemented.

The report, circulated to the credit unions 10 days ago, recommended the creation of the position of full-time chief executive. At the moment, the combined post of president and chief executive is a part-time post.

It also said the board should be reduced to 13 positions from 16 and called for improved communication and public relations functions.

Others elected to the board yesterday include Mr Jerome Dawson, Mr David Eastment, Ms Carmel Dowling, Mr Michael Gormley and Ms Kay Geoghegan.