Regulator hits Irish Life with €600k fine

IRISH Life & Permanent has been hit by a €600,000 fine by the Financial Regulator for submitting a series of inaccurate figures on the size of its asset base.

The errors go back to late 2007 and were repeated until early March when the author of the reports spotted the mistake, which he then reported to the financial watchdog.

An IL&P spokesman, Ray Gordon, blamed “human error”, adding the fine was not in any way connected with the controversial €7 billion loan made by IL&P to Anglo Irish Bank last year, which is still under investigation.

“The Financial Regulator has reasonable cause to suspect that Irish Life & Permanent’s internal control mechanism failed to ensure the accuracy of certain regulatory reports in respect of its banking business,” the regulatory body said.

Mr Gordon accepted the group made a “serious error” but added that the mistake “didn’t impact on management of the group or the published results of the group in any way”.

The group said the mistake should not have happened and “we apologise for that”.

Meanwhile, it has been reported that Irish Nationwide received a cut of profits from successful developments it had financed.

Even though it was established as a building society lending home loans, four-fifths of its revenue came from financing developers, including such well-known names as Liam Carroll.

And RTÉ reported that Irish Nationwide was not only lending to developers but also directly profiting from successful projects.

Irish Nationwide set as a condition on certain loans to developers that the building society would get a proportion of profits.

This would usually apply when profits in a property project reached a certain point sometimes following a sale.

Financial sources said the practice is unusual but not illegal.

The proposed National Asset Management Agency has been made aware of the issue.


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