VEC to be quizzed on €430k loan

County Cork VEC secured more than €430,000 in unauthorised borrowings from Mallow Credit Union and signed up to a long lease with no permission.

VEC to be quizzed on €430k loan

The Department of Education wants answers from CCVEC on its interests in the Youthreach buildings and childcare centre = at Ballyellis[/url], Mallow, after it gave conflicting accounts of the arrangements underpinning the deal and misled the department over the lease.

It supplied different information to Pobal, to secure a €1m capital grant for the childcare centre, than it has given the department.

A third account of its interest in the property was contained in its planning application to Mallow Town Council, when it claimed it owned the site outright.

Last summer CCVEC sought retrospective permission for a third shortened lease for Ballyellis. This was signed without permission after CCVEC decided not to draw down €430,000 in credit union funds it secured privately. It has still not informed the department why the alterations were necessary or that the €430,000 loan facility ever existed. =

The more recent 2018 agreement with Mallow Credit Union constituted a third lease CCVEC signed for the same property. None were pre-approved by the department, as required under VEC legislation.

The former head of CCVEC’s audit committee, Cllr Humphrey Deegan has asked acting CEO Joan Russell to deliver a report to today’s meeting. He first alerted the department to the issue last year.

Since then it has emerged that in 2008 CCVEC topped up a €1m grant from Pobal to build a new childcare centre with the separate fund from the credit union. An indenture was supplied to Pobal in 2008, before the capital grant was drawn down, to prove the existence of the 2031 lease. It was signed by the then chairman councillor Noel O’Connor and the former CEO Barra Ó Bríain.

Mallow Credit Union had bought the property for CCVEC on Dec 23, 1996, to house the Youthreach facility. Under this deal CCVEC was entitled to purchase it outright for €6,349 when the lease expired in Dec 2011. However, CCVEC surrendered its right to own the Youthreach building and the land adjoining it, where the childcare centre stands, in order to get extra funding.

In 2011 CCVEC decided not to draw down the money and got into a third lease which will run until 2018.

The property was revalued by Mallow Credit Union last October as an asset worth €450,000. T==he credit union said there is only one more payment of €6,349 due from CCVEC before it transfers ownership.

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