Finance adviser says he was ‘wrongly smeared’ in Siteserv commission report

A key figure in the Siteserv affair has accused the judge who investigated the deal of “errors and misjudgments”, saying he was “wrongly smeared” in the report on the company’s €45 million sale to businessman Denis O’Brien.

Corporate finance adviser Walter Hobbs observed the 2012 transaction for the nationalised Irish Bank Resolution Corporation, which wrote off €119 million of the €150 million that Siteserv owed after the sale. A Commission of Investigation was established in 2015 after a Dáil row over the loss incurred by the State.

After a seven-year inquiry, Mr Justice Brian Cregan found in September that the sale was based on “misleading and incomplete information” that Siteserv provided to the State-owned bank. The sale was so tainted by impropriety that it was not commercially sound, the judge said.

But Mr Hobbs has challenged such findings, saying a “State injustice” was done by publishing the report because of what he described as “pervasive and fundamental” flaws in the conduct of the investigation and the judge’s conclusions.

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Among other issues, Mr Hobbs criticised the commission for a lack of expertise and cited problems with the findings about the exclusivity granted to Mr O’Brien’s team in sale talks, the commercial soundness of the deal and the conclusion that Siteserv could have realised another €8.7 million from the sale.

The calculation of €4 million of the €8.7 million was marred by “fundamental errors” of understanding in relation to the granting of exclusivity, he said. The remaining €4.7 million arose from a “mix of error and speculation” by the commission.

Mr Hobbs said he suffered “immense and wholly unjustified damage” to his reputation in the Dáil debate on the report and added that he discharged his role professionally with “utmost competence, commitment and integrity”.

He wrote to the Attorney General last August – weeks before the report was released – saying publication should be stopped. “In my opinion, the investigation was a debacle and the commission’s report was fatally flawed.”

The Attorney General’s office replied to say that the questions were not a matter for it. John Shaw, a senior Department of the Taoiseach official, wrote to Mr Hobbs five days after the report was released saying the commission was independent.

[ Siteserv report stands as an unflinching indictment of highly questionable conduct in dark days of last financial crisis ]

Access to such records was refused under the Freedom of Information (FoI) Act but Mr Hobbs provided them to The Irish Times, saying the FoI decision was a surprise. “I think the matters raised are of public interest and I believe in transparency so, in the circumstances, I have decided to make these letters available,” he said.

Mr Hobbs replied to Mr Shaw on September 15th, taking issue with what he said was the department “washing its hands” of the matter. “The report was published by your department after having been put on notice that there were serious problems with the conduct of the investigation and the drafting of the final report.”

Asked about Mr Hobbs’ correspondence, the commission declined to comment.

The department said the Taoiseach had “no role or function” in relation to the commission’s operation or the experts who assisted with its investigation. “These were matters which the commission alone could decide,” it said.

“The Taoiseach published the commission’s report on the Siteserv transaction in keeping with his statutory responsibilities as specified minister for the commission under the Commissions of Investigation act 2004.”