No sign of the Nama scandal going away

The scandal surrounding Nama and the sale of its Northern loan book is being ignored — but that can’t go on forever as new nuggets of information emerge, writes Michael Clifford
No sign of the Nama scandal going away

ONE of these days, somebody somewhere in power is going to finally say “enough is enough” and initiate an investigation into Nama.

So far, the signs are that the scandal bubbling under Nama is going to continue to be ignored, but that can’t go on forever. As new nuggets of information continue to tumble out the smell is growing. And that’s before the new Dáil sits and Mick Wallace gets stuck back into it.

The matter at issue is the sale of Nama’s portfolio in Northern Ireland: around 850 properties were sold as a bundle to a US investment firm, Cerebrus for €1.3bn in June 2014. The sale has since become mired in controversy.

Wallace told the Dáil last year that €7m had been diverted into an offshore account as a backhander to some who had facilitated the deal. These included businessman Frank Cushnahan, who served on Nama’s advisory body in the North and would have had access to confidential information. Mr Cushnaáhan denies any impropriety or receiving any money. It has emerged, however, that €7m had been diverted to an Isle of Man account but was later retrieved.

The sale to Cerebrus went ahead after a previous bidder, Pimco, informed Nama that it had come to the company’s attention that somebody was due to receive monies in an improper fashion. Pimco then withdrew from the process, or were asked to leave by Nama. The entities differ on their parting of ways.

There have also been allegations that €15m was to be paid to three public and business figures in the North for facilitating the deal. Cerebrus has denied making any payments, and Nama’s position is that anything that may have been planned or paid occurred on the buyer’s side of the deal and has nothing to do with Nama.

Then last week matters took an interesting turn. The BBC’s Spotlight programme broadcast an investigation into the affair that included covert recordings of meetings. In one of these meetings, Mr Cushnahan appears to confirm that he was due to receive a fixer’s fee for the deal. There have also been reports of contacts between some of the business figures involved and senior people in the DUP which haven’t been satisfactorily explained.

Frank Cushnahan
Frank Cushnahan

“So what?” some might say. Smoke can be generated without a fire, and while there may be some embers in this story, explanations other than sinister can be forwarded for much of what happened.

That might be sustainable if nobody else was interested in it. As it happens, there are currently three separate investigations into the deal. The policing body for the US stock exchange, the Securities and Exchange Commission, is investigating the matter. So also is the UK’s National Crime Agency, a body that is described as Britain’s equivalent to the FBI. The BBC confirmed over the weekend that the NCA had been in contact over the programme and in particular the covert recordings that were broadcast.

There is also an inquiry under way by a committee of the Northern Ireland Executive, which has heard from a number of witnesses, but crucially not from the main people in Nama. That inquiry is likely to be short circuited by the elections to the executive scheduled for next May.

Three different bodies are now conducting criminal, regulatory and political inquiries into a deal which, if it was untoward, most likely resulted in citizens of this State being the victims. None of those inquiries are being conducted by agencies of this State or any instrument appointed by the Oireachtas.

This matters greatly because the shortage of public money over the last eight years led to severe hardship for some and a drop in living standards for many. In such a scenario, it is imperative that the citizens have full confidence that nobody has been benefiting from their pain.

So far, Nama’s stance of “Nothing to do with us, gov” has been backed up by the outgoing government. The agency says that the best result was achieved for the agency in disposing the assets as was done.

The Department of Finance has largely echoed Nama’s position. Minister for Finance Michael Noonan did not instruct Nama officials to co-operate with the inquiry by the North’s parliamentary committee inquiry. To a large extent, the attitude appears to be to keep the head down and play dumb.

Yet the questions will not go away. If there is any suggestion that monies were due to be paid to somebody for fixing a deal, why would that have been arranged unless there was an advantage to some parties? And how could such an advantage accrue without there ultimately being some cost to Nama, and by extension, the citizens?

Minister for Finance Michael Noonan
Minister for Finance Michael Noonan

Why was the sale process continued and completed so quickly after a problem was identified with the previous bidder? And why was there such a rush to dispose all the assets in one bundle in a property market which was expanding?

There is no suggestion that the principles in Nama, the chairman and chief executive, were engaged in anything untoward. The integrity of Frank Daly and Brendan McDonagh respectively is not up for grabs.

But a suspicion remains that the reluctance to have a proper investigation in this jurisdiction is driven by the fear that whatever tumbles out will ultimately result in embarrassment at the least for either Nama or its political masters.

We have been here time and again. Prior to the establishment of any number of tribunals or commissions of investigation over the last two decades, there were repeated attempts to drag feet and keep the head down, in the hope that the issue will go away or be buried with time.

The most recent example of that approach was in the run-up to the establishment of the commission of investigation into matters pertaining to IBRC, the State entity winding down Anglo Irish Bank.

Frank Daly and Brendan McDonagh
Frank Daly and Brendan McDonagh

The trajectory of the suspicious elements involved in the sale of Nama’s northern loan book is taking on a similar character. And it’s not going to run out of steam anytime soon. Wallace has already indicated that he has more information to introduce under Dáil privilege because it’s not being dealt with by the State.

There is no sign of this going away.

In the meantime, it reflects poorly on the State that it is willing to sit back and watch agencies in other jurisdictions investigate the matter on behalf of Irish citizens.

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