The head of the sector’s representative body admitted the situation to the banking inquiry on the same day as auditors also defended their role in failing to ring alarm bells.
Under questioning from Sinn Féin finance spokesman Pearse Doherty, The Institute of Professional Auctioneers and Valuers chief executive Patrick Davitt said that during the boom standards in the sector were not robust enough to flag concerns.
However, despite the profession adopting EU “blue book” standards in 2012, he said “the methodologies will be the same today” and told Fine Gael TD John Paul Phelan he did not think any changes were introduced.
When it was put to him by committee chairman Ciaran Lynch that those operating in the sector benefited from higher prices as they received a sale percentage, Mr Davitt said auctioneers were “caught in a bind” as their “duty of care” was to “who is paying for it [the valuation]”.
The auctioneer said the crash was very unfortunate and that his profession “played a part because [we] were in the game”.
However, while saying developers called to encourage values up or down, he said there was no influence.
Meanwhile, Deloitte Ireland’s managing partner Pat Cullen and head of audit Gerry Fitzpatrick defended the firm’s failure to identify risks before the crash.
The first auditors to attend the inquiry said despite Ulster Bank needing a €14bn bailout from its UK parent company, they are satisfied audits were done with diligence. This included knowledge of a €4.5bn “property risk” transfer by the bank to its Northern Irish affiliate regulated in the UK allowing it to circumvent property sector limits in the Republic set by the Central Bank.