Irish Nationwide ‘sorry’ for email
Saturday, October 04, 2008
By Brian O’Mahony, Chief Business Correspondent
IRISH Nationwide Building Society has apologised for an email sent by the son of chief executive Michael Fingleton soliciting deposits in Britain on the strength of the Government’s guarantee on deposits in Irish-owned banks.
In its statement the society described the action as “inappropriate and regrettable in the circumstances”.
Michael Fingleton Jnr sent the email to a friend in the company’s London office saying Irish Nationwide now was the “safest place to deposit money in Europe with an AAA guarantee from a country with the lowest national debt to GDP ratio of any AAA country”.
“It is inappropriate to use a guarantee in marketing, advertising, or in any communications to customers or potential customers,” the Financial Regulator said in a statement.
Central Bank governor, John Hurley, said the letter was a serious breach of the terms of the guarantee.
The action was “not acceptable and I think the statement from the Irish Nationwide reflects this.
“The Financial Regulator made that absolutely clear … and again that is an issue that is being addressed now by the Financial Regulator,” he said.
Joan Burton, deputy leader of the Labour party and its spokesperson on finance, said the Government must indicate what action it will take against banks found to be abusing the guarantee scheme.
“I am sure that officials of other institutions will not be so imprudent as to put their comments in writing, but what possible steps can the Government take to prevent this selling pitch being made verbally?
“The last thing we want from the guarantee scheme is a flood of hot or dubious money into Irish banks,” she said.
Neither was it in anyone’s interest to have vast sums being lodged in Irish accounts, only to be withdrawn weeks or even days later, she said.
The banks promised, Ms Burton said, that the guarantee scheme would not be abused in this way.
“This email raises serious questions about the value of this commitment.
“The Government must make it clear that banks found to be abusing the scheme will be subject to sanction and, in the case of systematic abuses, may be removed from the scheme altogether,” she concluded.