It was the businessman’s boastful indiscretion that forced a reluctant government to establish the tribunals that did so much to destroy the reputations of those political and business leaders once thought untouchable.
Is it too much to hope that Mr McErlean’s startling testimony will force our government to belatedly take the kid gloves off and confront our banking system and financial regulators with the vigorous determination the allegations, shocking even today, demand.
A response considerably more assertive and reassuring than yesterday afternoon’s tragic call from Finance Minister Brian Lenihan for a “review” of the board and management of Irish Nationwide is needed.
Mr McErlean said our financial regulator knew about AIB overcharging in 2001 but later gave the false impression that it did not become aware of it until 2004. He said the regulator had investigated the issue in 2002 but failed to protect consumers. Remember, the financial regulator is paid to protect consumers yet it is alleged he acted in the best interests of AIB and hung consumers out to dry.
Mr McErlean also described how he told the Financial Regulator that the AIB subsidiary, Goodbody, had arranged for all of its purchases of AIB shares to go through what he believed was an illegal process.
Yesterday we suggested that the planned “national day of action” by the unions was tantamount to economic suicide and, though there may yet be light at the end of that particular tunnel, it is banking and regulatory scandals like these that justifiably provokes outrage. If Monday’s strike represents economic suicide this kind of failure represents economic treason.
It is because this boil remains un-lanced that our reputation is in tatters and until the government stands up to the plate and confronts this culture of cronyism and institutionalised corruption we have little prospect of rebuilding our reputation let alone our economy.
In two weeks Mr Lenihan will introduce a budget tougher than any of us have ever seen. Without popular support he will be unable to impose the kind of measures needed to avert national bankruptcy. Without support chaos looms. How can he and Taoiseach Brian Cowen expect the kind of sacrifice needed unless these pirate bankers and complicit regulators are made to face the consequences of their shameless actions?