IBRC ‘paid €67m for overcharging’
The bank undertook a forensic investigation going back as far as the early 1990s and looking at overcharging right up until 2005 to ascertain the extent of the problem and concluded that customers had been overcharged by €43m.
The former Anglo Irish Bank decided that customers should be paid a further €24m in compensation and consideration.
A source close to the bank said that the investigation was carried out in 2010.
However, the banking expert called to give evidence at the John Flynn challenge to IBRC’s liquidation in Delaware, Eddie Fitzpatrick from BankCheck, said there was no way an internal investigation at IBRC would have uncovered the €1bn in overcharging he believes took place.
“What has happened is that the liquidator has come in and asked the staff what they did and are they happy with it,” he said.
Mr Fitzpatrick alleges that in the 300 accounts he has audited he has uncovered serious loading by the bank. He claims that the bank loaded the Libor and Euribor rates as well as charging inflated fees and loading the Reserve Asset Cost.
He said he believes that the bank overcharged in the region of €1bn-€1.2bn and there should be a fully independent forensic probe.
In the court on Monday night in Delaware Judge Christopher Sontchi signed off on a protective order shielding KPMG’s Kieran Wallace and Eamonn Richardson, special liquidators, from intensive questioning from affiliates of Elliott Management Corp and John Flynn.
The Elliott hedge fund had claimed Irish liquidation procedure is a political act, not deserving of recognition under US bankruptcy law.
The special liquidator had responded that any inquest into Irish politics would result in a probe into Elliott tradings and how much the hedge fund paid for its Anglo Irish debt
The IBRC case is expected to continue in about four weeks’ time when the bank will petition to the court to have the special liquidator recognised in the US.
CONNECT WITH US TODAY
Be the first to know the latest news and updates
