The Irish Bank Officials Association (IBOA) has warned it will not tolerate blame being placed on relatively junior staff at National Irish Bank for the controversial Clerical Medical International offshore investment scheme or the disclosure of details of the scheme.
NIB has claimed that the public disclosure of its involvement in the offshore investment scheme followed the unlawful removal of documents from its premises. With an internal investigation now underway at NIB as well as investigations by the Central Bank and the Revenue Commissioners, IBOA general secretary, Mr Ciaran Ryan said any bank employee who disclosed the truth about any illegal or unethical matters should not suffer.
The union would defend any whistleblower, he said.
"If illegal things were done or there was an attempt to assist customers to evade tax, we will not accept a situation where our members are blamed. Any such decisions had to be taken at the top," he insisted.
Mr Ryan said he had no knowledge of who revealed the details of the Clerical Medical Scheme. "The word out there is that a member or members of staff revealed the situation. We have no knowledge or proof of that other than the word of management. It would, of course, be open to question whether the person or persons involved are still on the staff at NIB." IBOA has written to National Australia Bank (NAB), NIB's parent, setting out its concerns. The bank replied that it was engaged in a detailed investigation and would talk to the union when that was concluded. IBOA members at NIB range from junior bank officials to branch managers. IBOA has about 400 members at NIB out of a staff of 600.
As the internal investigation under a team from National Australia Bank's European headquarters continues, Labour Party finance spokesman, Mr Derek McDowell has called on the bank to make public its findings.
Last night, a bank spokesman said he could not comment on whether NAB would disclose the results of its investigation.
It is understood that the investigators at NIB are looking right back to the origins of the relationships of the CMI "investors" with the bank. Market sources speculated that the original funds lodged as deposits with NIB could have been funds being brought back from off-shore accounts in the 1980s. The investigation is looking at what information the bank sought from the customers before it took in the original funds and what information the bank was required to obtain under exchange control, revenue and Central Bank requirements. A bank source said last night that the NAB group managing director, Mr Don Argus, was determined that "heads will role if what has been alleged is found to be correct". The source said that Mr Argus was "very angry" about the CMI affair.
The disclosure of the CMI scheme has lead to speculation about the future of National Australia Bank in the Irish market. While a spokesman was adamant that NAB remains fully committed to the Irish market, the CMI disclosures together with its failure to acquire the TSB Bank and the apparent closing of that door last week by TSB chairman, Mr Dermot Whelan could make NAB decide to pull out of the market.
NIB would be NAB's only euro operation when the single currency comes into force and the costs of preparation are high, particularly for a small bank.
Asked if the sale of its bond product in the Irish market met with Irish regulatory requirements, a spokesman for the Isle of Man-based CMI operation said: "The product is an international product offered by CMI through its Isle of Man office and authorised by the Isle of Man authorities. We clearly stated in all our documents that the responsibility for seeing that the sale complied with local regulatory rules was a matter for the adviser and client in that market".
