Liquidator’s IBRC report in progress


In your NWL link, from the discussion with Who Shot the Tiger (WSTT), it would seem that WSTT either works for Bank Check (the company seeking to drum up business from this) or one of its competitors (commenting that he/she was currently completing interest checks for clients). It is this entity (BankCheck) which is citing the 500mm but I note it is itself aligned with some developers who were challenging IBRC’s chapter 15 protection request in the US - Bank Check submission under docket 88 (I haven’t looked at this yet). While the head of Bankcheck made a presentation to the Oireachtas in 2008 along with “Friends of Banking Ireland” (Mr. Jerry Beades XX ) I don’t think this link has continued.

Given I haven’t seen BankCheck’s submission & Peter Mathew’s/Declan Ganley’s comments/exhibits don’t include any supporting evidence relating to “fraudulent” misspricing of base rates pre 2004 - I would refrain from calling anything fraudulent at present.

What I find odd is the fact that this is a simple calculation to do (reference rates are publicly published & everyone has excel) - how would it be possible that this was endemic and no one picked up on it and no one challenged it in the courts?

Either way, i think these should be classed as unsecured creditors which could be the best result from the taxpayer. I would expect some debtor’s who can repay their debt may seek to have the balance due offset by the overcharged amount (they could face problems though if their debt was sold to an other owner).

EDIT - having reviewed the Bank Check docket, he states that he reviewed a large number of Anglo loans (270+) & and found base rate discrepancies from 1990 onwards ranging from 50bps in the early 1990’s to single digit basis points in 2003 & 2004. He notes that some of these discrepancies relate to different interpretations of the loan facilities (Anglo disputing the meaning of certain T&C’s). However, the crux of his submission was a request for discovery whereby he was seeking access to nearly all treasury communications from 1990 onwards (emails, phone calls, memos) and all Anglo board minutes. This seems a bit like fishing.

His numbers are a little odd. He claims he examined over 270 loan accounts (240 variable rate Euribor/DIBOR loans, 17 LIBOR loans & 15 other currency loans). However, he then goes onto say 524 separate (different dates - i assume he means interest reset dates) were found to be “loaded”. There is 250+ possible reset dates p.a. so without outlining the full details it’s difficult to draw a conclusion 250 by 13 years is 3,250 reset dates (were all the loans being reset on the same days (quarter end, month end etc)). He found consistency in the rate variances in 1992 (0.377%), 1993 (0.483%) and 1994 (0.435%) but noted that subsequent (post 1994) rate variances were erratic/random. He claims Flynn was overcharged by Eur 7.7mm (50% of which was due to disputed terms). It’s very interesting - I must see if IBRC responded in court to his allegations.


Good post Andy.

I would certainly expect any overcharging to be dealt with ‘in-house’ where overcharging is quietly set against existing debt, but that raises a very significant issue. Why is the taxpayer on the hook for it? If it was just an accounting error then any claim is beyond the statute of limitations, and if it was deliberate fraud then a) the Irish taxpayer should be protected from it, and b) someone should be doing a long term of jail time.

Why are we paying anything towards this?


Plenty will but whether that is a basis for claiming against the banks is doubtful. The amount of interest involved was large on a global scale but when you break it down per consumer, it was minuscule. That is why a claim to recover interest fraudulently charged may not be worth the effort.

If, however, the fraud meant that the interest provisions in the loan agreement were unenforceable, because the fraud rendered the agreement void, then the bank would have to pay back the interest charged to the consumer, either from the date of the agreement or the date of the fraud. This can be quite a lot of money.

The claims have already started in the UK. Also, the Statute of Limitations may only start to run from the date of the discovery of the cause of action, so the usual 6 year rule may not strictly apply the way it generally does. … z3d9olV9jK


I had a read of Eddie Fitz’s testimony & the subsequent cross examination of Kieran Wallace over lunch. Cost me $15!!!
I note Wallace didn’t object to the claim but he stated:
(i) these issues were addressed by the former management team between 2010 & 2012 i.e. pre-liquidation,
(ii) checks were issued to affected borrowers,
(iii) some (few) borrowers chose not to cash the issued checks (seeking to get more money back).
(iv) Subsequently the Bank went into liquidation and these claims are now “unsecured”. As such, Wallace didn’t waste time looking into the calculations as he wasn’t sure there’d be a surplus for unsecured creditors.
(v) As part of the liquidation, they reviewed the overcharging issues & were satisfied it was no longer continuing,
(v) Flynn was looking to take his case in the US so as to attach his claim to IBRC’s US assets - effectively gaining structural seniority to Irish unsecured creditors - which includes the Estate of IBRC in liquidation as its the shareholder in the US subsidiaries. And consequently, the state. I think theses claims would be senior to the states anyway.
(vi) IBRC’s lawyer noted, the overcharge claims re fraud etc. were hearsay - as Flynn’s agent (Bankcheck) made statements about deceptive practices etc. yet at the same time was seeking a huge volume of information, which he would require to prove his point. Essentially, he was assuming this but didn’t have any proof.

Regardless, they lost the first case when Chapter 15 protection was afforded to IBRC and their subsequent case in NY was lost of forum grounds (it’s a decision for the Irish courts not US)


@Andy, Very interesting. On the back of what you wrote it would appear to be a ball of smoke, but time will tell.