It seems that a new chapter is about to be written with respect to the banking crisis as the cosy relationship between the banks and Fianna Fail politicians starts to come to light.  As reported on Prime Time’s Monday night programme (watch it here), several Fianna Fail senators and TDs were in receipt of bank loans that avoided due process in their granting. The one catching the media attention (see here, herehere and here) is the €1.6m loan given to former Minister for Finance (and now EU Commissioner), Charlie McCreevy, by Irish Nationwide in 2006 in order to purchase a luxury apartment in the K Club (an exclusive golf resort).  The loan was seemingly given on short notice, avoided the credit committee (which was required for loans worth more than €1m), was processed without the required minimum paperwork, and was approved for a sum €100,000 greater than the price of the property despite the company’s policy of not granting mortgages of 100% or more.  The property is now thought to be worth less than half its original value. 

It seems that neither the bankers nor politicians can be trusted when it comes to money.  It’s little wonder then that the government were reluctant to allow full and transparent regulation of the banks in the lead up to the crisis given that they were some of the main beneficiaries of lax controls.  And it’s also unsurprising that they are now equally reluctant to have a full and open inquiry into the dodgy and fraudulent banking practices that have execarated the crisis.  And heaven knows what would come out if whistleblowers are given the appropriate protection to allow them to speak freely.  As Morgan Kelly noted on Monday night’s programme, perhaps it’s also time that politicians had to declare more than their assets, but also their full personal loan book (as well as their expenses, etc).  If Simon Carswell is updating his 2006 book, Something Rotten: Irish Banking Scandals, he must be pulling his hair out trying to keep up with what’s been coming to light over the last 18 months or so.

Rob Kitchin