My Banking Inquiry….

December 30, 2012

We may not get the banking inquiry we want, but we may have a on the horizon a court case that will suffice to draw up the elements of what a court case that would bring most of the information we want from such an inquiry. Apparently legal action around the Quinn family’s case against Anglo(IBRC) is to focus on the role of the banking regulator, the Department of Finance, the government, the ECB and the Irish Central Bank,  in the demise of Anglo. The Quinn family are out to prove that incompetence, political interference and corruption of Anglo due to malpractice of the above institutional players will reward them with a massive compensation claim.

Perhaps taxpayers can take the above wave and surf it to deny the intent of the ECB to odiously stick Irish taxpayers with the debts of the rogue bank Anglo.

This issue is the greatest issue faced by government in Ireland. It is also the greatest issue of denial by government in Ireland. Smoke and mirrors from government have successively broken claims of movement on this. Successive postponements, cancellations and kicking the can into the future blurred by peacocking efforts on behalf of Enda Kenny and Michael Noonan have yielded zero.

Enda Kenny continues pleading with ECB and troika to send him a signal that there will be movement on Anglo promissory notes, but hitherto his efforts have paled against the IMF who’ve made a greater effort on Ireland’s part to resolve the issue. The next installment of €3.1 bn with similar due for approx the next decade, is due March 2013. We were due to pay €3.1bn last year but got payment deferred to this year where we’re due to pay up €6.2 bn for the rogue joke Anglo.Well, actually, they said we didn’t pay, but we did. Nama issued a bond and it was routed through a bank and like all NAMA property deals they’ll probably argue we’ll make a profit on this though it cost us €3.1 bn. Before Xmas Enda Kenny said a deal was imminent and we were expecting (well, not this writer) a deal which as usual never came. We’ll see who pays in March.

We should simply refuse to pay and refuse to stay in a euro which is dragging this country beneath the waves. Political failure is masked by lack of progress and denial and ‘green shoots’ where none grow. Some did quite well out of the famine and they will do quite well out of Ireland’s austerity regime.

Since all leaks into our banks have been plugged by dressed up pseudo cover-up banking inquiries or been plugged by insider so-called public interest directors exposed this week as ineffective, answerable to no one, bloated on their fees and apparently joined at the hip with the bankers they were meant to police, lets have a go here at a banking inquiry of our own. Lets say we want some practice for the real thing in the dock of the courts to come.

Concealment of the finances that led to Peter Madoff(1) getting 10 yrs for his role in the Madoff ponzi scheme in a just and fair society in Ireland would see replicated similar trials re eg  B&B loan breakfasting etc. But lets not anticipate the outcome of the courts or even the possibility of such cases. Lets rather look at some evidence that should lead to the courts. You want to know how bank share prices could have been manipulated by such lending practices, what senior directors got by way of share options and bonuses?

In a foreword to Ellen Browne’s book, “The Web of Debt”, Ellen Hodgson Browne, Revised and updated Jan 2012, http://www.webofdebt.com/

A common practice is for loan officers to ignore the long-term risk of loans and approve those loan transactions with the highest fees and interest paid immediately– income which can be distributed to the principal executives of the bank. Such distribution is buried within the bank’s owner/manager compensation and is distributed to the principal owners as dividends and stock options. That helps explain why, in my home state of Kansas,a major bank in Topeka was run into bankruptcy after its chairman entered into a development and construction loan involving a mortgaged 5,000 acre residential development tract in the “exurbs” far outside of Houston, Texas. The development included curbs, gutters, pavement, street lighting, water, sewer, electricity – everything but homes and families! If the loan had been metered out in small phases to match market absorption, the chairman of that once-fine institution would not have been able to disburse to himself and his friends the enormous up-front loan fees and interest owing to that specific transaction, or to the many loans he made just like it. During the 1980s, developers from across the country beat a path to sleepy Topeka and other areas sporting similar financial institutions, just to have a chance to dance with these corrupt lenders. The managers and developers got rich, leaving the banks’ shareholders and the taxpayers to pay the bill.”

Does the above sound familiar? Right, you want to go around the ghost estates and find out how they got their loans? Who dealt with what? Planning permission, bank lending practices, who negotiated what? Because you believe some white collar crime might be involved?

(1)http://money.cnn.com/2012/12/20/news/companies/peter-madoff-sentencing/

Meanwhile we are coddled by false statistics understating our unemployment levels that fail to take in the massive emigration and the destruction of the domestic economy.

Denial is the norm along with dismantling our educational service by removing allowances for extra qualifications gained through the intelligence and initiative of young people deepening their intellectual qualifications is now the new ‘smart economy’. Inequality is the norm where initiative goes unrewarded and political incompetence is the new norm.

Happy 2013 to all.

End.

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