Lenihan: Up to NAMA to make false data complaint

FINANCE Minister Brian Lenihan believes it’s up to NAMA whether or not the agency makes an official complaint to the authorities following claims it had been given false information by banks.

Financial Regulator Mathew Elderfield believes the agency has information which “substantiates a claim that NAMA was provided with false and misleading information by the banks”.

His office has been in contact by both telephone and letter to NAMA chief executive Brendan McDonagh about the claims.

Fianna Fáil’s Michael McGrath has also written to Mr McDonagh telling him he has a “duty” to report such information if he has it.

A spokesperson for the finance minister said whether NAMA makes a complaint was “a matter for the NAMA board”, emphasising Mr Lenihan trusts the agency to make its own decisions. NAMA has insisted it will provide information to any inquiry that requests it.

The claim was initially made by Mr McGrath at the Public Accounts Committee on November 18.

“It seemed to me there was a clear pattern of false and misleading information being fed into NAMA by the main banks in Ireland during 2009,” he told the committee, which was addressed the same day by Mr McDonagh and the agency’s chairman, Frank Daly.

Mr McGrath drew the conclusion from the difference between the discount banks believed they were entitled to on their loans to that which eventually applied after NAMA carried out its own due diligence.

Mr McGrath said if NAMA had accepted in good faith the information provided by the banks it could have overpaid for their loan book to the tune of €20 billion.

Mr McDonagh told the committee he did not disagree with what Mr McGrath had said.

The following week, Mr Elderfield wrote his initial letter to the committee saying he expected NAMA would contact the Central Bank with information substantiating the claim.

“I should expect that, at the same time, NAMA will inform An Garda Síochána and the Director of Corporate Enforcement of any similar concerns,” in said in the letter dated November 26.

He said if information substantiating the claims was not made available his staff would contact Mr McDonagh the following week.

On December 6 he wrote again to the committee saying his office had been in contact with Mr Elderfield four days previously.

“In our communication with Mr McDonagh we drew attention to NAMA’s obligations to report to the [Central] Bank reasons and information of a suspicion that a participating institution may have contravened a law relating to the regulation of financial services within the remit of the bank,” he said.

Mr McGrath also wrote to Mr McDonagh on November 25 saying: “As a public official in a very senior role, I believe you have a duty to proactively follow up on this matter and to make your views known to the relevant bodies by way of a complaint.”

He said: “I do not believe it is enough to say you will co-operate with the bodies. You need to raise these matters with the relevant bodies so that they can investigate.”