Friday, June 25, 2010

Banking Scandal -and its not even a headline

If Fianna Fail had one bit of good news in the past few weeks, it was FGs melt down. The media management has been magnificent..
The entire medias eye was off the ball, and FF will get away with the biggest failing in the political history of the Island.
The two reports dealing with a disasterous financial meltdown that lay the blame squarely on the Government.

Dermot Ahearn said the crisis was no ones fault, and the mantra is repeated.
The FF/Green manta is the crisis is outside our control - it was due entirely due to external factors.

This is a lie

The Watson/Reingling report states the crisis was home grown - and due to overly light regulation and political mismanagement.

Governor Honohan said in his report that the collapse of Lehman Brothers did not cause the Irish banking crisis.

The financial regulators were disfunctional, 'intrusive demands" from line staff were set aside when senior regulators were approached.

To quote the Watson Reingling report “internal procedures were overridden, sometimes systematically.”
The regulators did not do their jobs, and on the basis of political and business favours they were overlooked.

Having light touch regulaton is one thing, but the shelving of investigations is to me criminal, and someone needs to answer that.
The excuse that the crash was unforseen is untrue - there were some very serious people who warned of the crisis.
In April 2007 Prof. Morgan Kelly warned we were heading for a recession with a hard crash because we had a classc set up for a property bubble bust.
Bertie in response to this and other warnings said that sitting on the sidelines moaning and cribbing - and was surprised that people who warned of a potential bust did not commit scuicide.
Regling / Watson said that by the middle of the decade, the financial and property boom in Ireland presented features that should have sounded alarm bells loudly.
Domestic financial stability reporting by the Central Bank had failed in this regard.
Brian Lenihan emphasised that the reports were "preliminary, scoping reports", which would point the way to a more detailed examination by a Commission of Investigation.
One wonders who is going to be in charge of it? Perhaps a tame high court judge or Fianna Fáil Senator Ivor Callely?
It will investigate the banks, but not the government, this is pointless - the politicians were as responsible as the bankers.
In the banks already a few token heads have rolled.
But the people who have been bought in to run our banks were alreeady senior members of those boards.

We are leaving foxes in charge of the henhouse
I believe we need someone like Eva Joly, a Norwegian born French judge with an outstanding history investigating corruption by politicians and vested business interests.
She finished her work quickly in Iceland.
We need to know what senior regulators failed to investigate concerns, we need to know what politicians were involved in getting tax breaks for regulators.
We need to uncover and prosecute those guilty of corruption and incompetence - otherwise they will do it again.

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