INBS’s ex-auditors KPMG given final deadline for inquiry statement

An inquiry into Irish Nationwide Building Society has given two partners of the failed lender's long-time auditors, KPMG, a final deadline of December 14th to file witness statements on one of the matters under investigation.

"I do not want to hear any more excuses," said Marian Shanley, chairwoman of the three-member inquiry panel, told a solicitor representing the two KPMG partners – Vincent Reilly, who had been INBS's key contact at the firm, and his colleague Alan Boyne.

The inquiry into the actions of four INBS senior managers – including its long-standing managing director Michael Fingleton – in the lead-up to the financial crisis was set in motion by the Central Bank in 2015. It is looking into seven alleged contraventions between August 2004 and September 2008, including that the society failed to process loans in line with policy, failed to obtain property security for commercial loans, and failed to get proper valuation reports on property against which it was lending.

Under investigation

KPMG had been INBS’s external auditor for three decades, including the period under investigation, before the lender collapsed at a €5.4 billion cost to Irish taxpayers.

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While Mr Reilly was among 26 witnesses to give evidence between last December and the end of June under the first phase of the inquiry – into the workings of the INBS credit committee – the KPMG partner and Mr Boyne have struggled to meet a number of deadlines to provide witness statements.

At the first public session of the inquiry since June, Ms Shanley noted that the two men were in late September given an October date to submit witness statements specifically on INBS's credit committee.

Marcus Walsh, a solicitor with A&L Goodbody, representing the two KPMG partners, said his clients have experienced difficulty allocating time with a "sustained focus" to complete the statements, as they meet other "professional requirements" and frequently have to travel abroad.

It emerged last month that public hearings of the inquiry had been delayed since the summer due to the “illness of one of the persons concerned”, known to be Mr Fingleton. The 81-year-old was not at Tuesday’s session.

INBS's former finance director John Stanley Purcell was the only one of the four men to attend. The society's one-time commercial lending manager Tom McMenamin and Gary McCollum, who once led the company's UK lending activities from a base in Belfast, are the other two individuals subject to the inquiry.