The Supreme Court ruling yesterday that employees of National Irish Bank (NIB) must respond to questions posed by the two inspectors investigating alleged fraud at the bank, is a powerful affirmation of the critical issues of public interest at stake in the inquiry. In a unanimous ruling, the court found that since the allegations against NIB involved commercial fraud - an issue of great public importance - the public interest demanded that employees must participate in the inquiry. Serious malpractices were first revealed by an RTE News investigation last March.
The judgment does not give the inspectors, the former Supreme Court judge, Mr John Blayney and the accountant, Mr Tom Grace, any new powers but it does strongly underpin the powers given to them under the 1990 Companies Act. The practical implications are clear; after a 10-month-period in which their work has been inhibited by legal objections, the two inspectors can now begin the work of interviewing former and serving members of the bank's staff.
In fairness, the concerns raised by NIB staff, that evidence gathered by the inspectors might be used against them in any future criminal trial, were not insubstantial. The court's ruling in this regard was also sensible and well judged; evidence gathered by the inspectors will be generally viewed as inadmissible - unless the trial judge is satisfied that it was given voluntarily by the relevant employee. This is broadly in line with a ruling by the European Court of Human Rights in Strasbourg in a case taken by the former Guinness executive, Mr Ernest Saunders.
To their credit, the NIB employees have accepted yesterday's judgment with good grace, speculation about a possible challenge in the European Court of Human Rights has disappeared and some 75 or so managers and assistant managers will now co-operate fully. Yesterday's judgment is not the first in which the Supreme Court has moved to protect the public interest in relation to the NIB scandal. Last year, the court upheld RTE's right to broadcast confidential information relating to alleged tax evasion schemes involving the bank and its customers. It held that the public interest must take precedence over the maintenance of confidentiality.
The investigation now underway by the inspectors is clearly of immense public importance since it relates to the integrity of the banking system. One aspect of the inquiry relates to fee-loading and overcharging of interest to customers; the other to the sale of unauthorised offshore bonds by a NIB subsidiary to facilitate alleged tax evasion. To its credit, the Government, through the appointment of the inspectors, has moved to ascertain the scale, depth and extent of the alleged criminality in NIB. With yesterday's judgment, the Supreme Court has helped to ensure that the full truth can, at last, be known. Mr Justice Barrington, in giving the judgment, went to the kernel of the issue: if there are grounds for believing there was malpractice or illegality in the operation of the banking system, it is essential that the public authorities should have the power to find out what was going on.