Michael Fingleton: May not have to repay €1m bonus

IRISH Nationwide boss Michael Fingleton is expected to resign on Monday next following the controversy over a €1 million bonus.

However, he is unlikely to hand back the money that was sanctioned before the bank guarantee scheme was introduced in September.

Mr Fingleton, 71, could also walk away with a €7m tax-free pension after it emerged he is the sole beneficiary of a €27.6m pension fund of which 25% is tax-free.

Government sources said Finance Minister Brian Lenihan made it clear that he wanted Mr Fingleton and other board members to go when he met two Government appointees earlier this week.

They will meet other board members today and report back to the minister on Monday, when they are expected to inform him of a “restructuring” exercise.

Sources said this will mean the resignation of Mr Fingleton and other non-Government appointed board members.

Mr Lenihan said yesterday he does not have the power to ask Mr Fingleton to give back the bonus paid last November because it was sanctioned before the Government introduced its guarantee scheme in September.

“The particular issue is that there was a prior decision to make this bonus.

“It is for the board themselves to establish the facts on that, see what remedies are open to them at the conclusion of that if they cannot progress the matter further it then goes to my desk,” he said.

The two “public interest directors” appointed by the Government in December, have been given a month to investigate the bonus payment.

Mr Lenihan said he could not divulge details of Monday’s meeting: “I’m not going into the details of my discussions with the board members who are appointed by the board at my request to that society.

“There are two of them, I met them earlier in the week and I expressed my concerns to them. There is a meeting of the board of Irish Nationwide later this week and they will report to me on Monday.”

Meanwhile, the minister also praised Gerry McCaughey, who resigned as chairman of the Dublin Docklands Development Authority on Tuesday amid controversy over his tax affairs.

Following the sale of Century Homes for €74m in 2005, Mr McCaughey and three other shareholders were advised they could benefit from not paying 20% capital gains tax on the transaction if their spouses lived in Italy for a year.

Mr Lenihan said: “I don’t think anyone could take from his ability or the determination that he had to sort matters out at the Docklands Authority.

“But he has decided in the light of facts which emerged that it was inappropriate for him to continue in these positions.

“Mr McCaughey is concerned about any lack of public confidence in him. I think he has taken a course of action that is honourable, that is his decision and I respect his decision.”