NIB rogue executives may feel the weight of law this year, says enforcer

THE corporate enforcer Paul Appleby will make a decision within the next three months whether to prosecute any of the 19 individuals named in a High Court inspectors’ report into fraud at National Irish Bank.

The Office of the Director of Corporate Enforcement (ODCE) and its legal advisers have been studying the 400-page report since it was released last July. The report by former Supreme Court judge John Blayney and accountant Tom Grace found that executives at the bank were involved in helping customers evade tax and were loading interest and fees on customer accounts.

Mr Appleby’s office has the power to bring criminal or civil charges against any of the former bank executives named in the report, which includes the Mayo TD Beverly Flynn.

Mr Appleby told the Irish Examiner yesterday that the most likely course of action is to seek prosecutions against the former bank executives to stop them from acting as company directors.

It emerged yesterday that the corporate enforcer secured 67 prosecutions last year for breaches of company law, a 56% increase on the 2003 figure.

The bulk of the charges were brought against directors for failing to keep proper accounts. During the year, it secured its first conviction for fraudulent trading, which resulted in one company being given a six-month suspended prison sentence.

Mr Appleby said compliance with company law has increased in recent years, but there was still a number of rogue firms and businessmen operating in Ireland.

“The decisions of various courts indicates that directors are continuing to be irresponsible and reckless in discharging their duties and our aim is to investigate those situations and bring the individuals in question to book.”

The office dealt with just over 2,100 cases in 2004, a 12% increase on the previous year. Mr Appleby said the vast majority of these cases had begun in 2004, but two-thirds of them were now closed. The number of directors disqualified shot up from 200 to 470.

The ODCE also saw a large increase in the number of directors who were taking out huge loans from their companies and Mr Appleby said there would be a crackdown in this area in 2005.

The ODCE is still investigating the events surrounding the Faldor slush fund that several former top executives at AIB benefited from.