IT IS “quite extraordinary” the chief executive of a licensed bank operating in the State should say he was unaware “very serious wrongdoing” was happening within the bank, lawyers for the Director of Corporate Enforcement have argued before the High Court.
There was ample evidence for the court to find there was a “very, very serious breach of duty amounting to gross negligence” by Jim Lacey when he was chief executive of National Irish Bank (NIB) between 1988 and 1994, Maurice Collins SC, for the director, said.
Mr Justice Roderick Murphy is hearing closing legal submissions in the application by the director for a court order disqualifying Mr Lacey from involvement in the management of any company on grounds of unfitness.
Mr Collins said there was adequate material in the report of the inspectors who investigated the affairs of NIB from 1988 to 1998 and from evidence to the court to support the making of that order. While the director was not alleging dishonesty by Mr Lacey, he was contending Mr Lacey was responsible for “a fundamental failure of governance”.
Beginning his closing submissions for Mr Lacey, John Gordon SC said it was refreshing the director had stated the NIB inspectors had made no finding of dishonesty by Mr Lacey and nor was the director alleging dishonesty.
The director’s case rested essentially on an allegation of incompetence by Mr Lacey, Mr Gordon said. The distinction between dishonesty and incompetence was of enormous importance to Mr Lacey, who had been 20 years in banking before he became chief executive of NIB.
Now, 15½ years after he had left NIB, the director was asking the court to find that Mr Lacey should be disqualified for the protection of the public, counsel said.
The fact the NIB inspectors had found no fault, apart from a limited exception, with either the internal or external auditors of NIB, put into context the unreality of the criticism being made of Mr Lacey for failing to pick up matters in the audit reports, counsel said. Issues raised by those reports had been addressed by the bank, he said.
Closing submissions are expected to conclude today.
