Setting Appleby’s record straight

I refer to the article by Matt Cooper on Friday, Feb 3, entitled “Appleby’s successor will need to be more proactive with investigations.”

As the article is based on a number of incorrect assumptions, I wish to set the record straight for the benefit of your readers.

Mr Cooper asks “What has [Mr Appleby] done, for example, about what went on at Irish Nationwide?” The simple answer is that INBS was a building society, not a company, and the ODCE has never been given any role to enforce the law relating to building societies. As such, Mr Cooper’s later comment that “It is to be hoped that his eventual replacement is a little bit more proactive” is entirely misconceived.

The article claims that “Appleby was slow enough in going after Anglo”.

The fact is that within 24 hours of the resignation of three Anglo directors in December 2008, the ODCE had identified potential breaches of company law and begun its investigations.

Regarding the searches of Anglo premises, the article states that “…while the raid looked good for the television cameras, it soon emerged that Anglo had been told the investigators would be coming.”

The decision to give the Bank some hours’ notice of the imminent searches was appropriate in all the circumstances. These included the fact that Anglo’s leadership at that stage consisted of Government-appointed public interest directors.

The article comments critically on the lack of ODCE follow-through after the Report of the High Court Inspector (Mr Bill Shipsey SC) into the “biggest insider dealing scandal ever disclosed in this country” at DCC.

Yet, the article acknowledges that “Shipsey exonerated DCC”. For his part, the Director is entirely satisfied that his decision not to take any further action was correct.

The article fails to acknowledge two significant earlier developments. From a criminal law perspective, the first was the referral by the Irish Stock Exchange of the DCC matter to the DPP in 2001 which led to a Garda criminal investigation (that did not result in the DPP charging anyone with a criminal offence).

Mindful of the civil enforcement potential of the Companies Acts, the Director later intervened in the Supreme Court during the civil insider dealing case to draw attention to the Court’s ability to impose a disqualification order based on the evidence that the Court had already heard. He later made a similar intervention at the High Court before the civil case concluded.

This initiative and the Director’s later decision to seek High Court approval of Mr Shipsey’s appointment reflected his serious concern about aspects of the events in question.

However, the decision to seek an external appointee was not, as claimed in the article, related to the ODCE’s “few resources”. In fact, the appointment entailed additional expense.

Moreover, the decision to seek Mr Shipsey’s appointment was consistent with all previous High Court investigations which have been led by external legal and/or accounting professionals.

The ODCE does not ordinarily seek to intervene in public debate about its operations.

We have done so on this occasion because of a concern that the incorrect assumptions of a respected journalist, commentator and author like Mr Cooper may gain a wider currency if allowed to go unchecked. Mr Cooper and other journalists can contact me at any time if they want to confirm certain issues of fact before going to print.

Kevin Prendergast

Corporate Compliance Manager

Office of the Director of Corporate Enforcement

Dublin 1