ANALYSIS:UNSPECIFIED LEGAL reasons have been advanced by the Government as the basis for the 10 shareholders who invested €451 million in Anglo Irish Bank not being identified. However, it is not clear what these "legal reasons" might be.
Reference has been made to the 1942 Central Bank Act, but this relates to the establishment of the Central Bank, and not to shareholding in commercial banks.
There is a common law right to banker-customer confidentiality, but this is not absolute. National Irish Bank sought an injunction to prevent RTÉ from naming investors in its Clerical and Medical insurance scheme, which was a vehicle for tax evasion.
The Supreme Court ruled that there was no protection for wrongdoing, and refused the injunction on the basis that there was no entitlement to confidentiality in the circumstances. It ruled that the public interest in identifying and combating tax evasion was greater than any public interest in banker-customer confidentiality.
No wrongdoing has been proved against any of the 10 anonymous investors, but the circumstances surrounding the nationalisation of Anglo Irish Bank, which may now be a liability for the taxpayer, establishes a clear public interest in identifying all the major parties in its recent transactions.
But banker-customer confidentiality may not even apply here, according to one senior counsel. There is a difference between a customer and a shareholder. Even if the 10 investors were also account-holders, this would not necessarily mean they were entitled to confidentiality as shareholders.
Another senior counsel pointed out that a separate issue arises if eventually any charges are brought against these individuals in relation to the transactions; for example, charges relating to the manipulation of the market. If they had been previously named, and if there was extensive, and hostile, coverage of them and their affairs in the media, they could argue they could not get a fair trial as a result.
But this would be unlikely to succeed. The courts have been quite slow to prevent trials going ahead on the basis of adverse publicity against an accused. The perpetrator of the rape of the girl in the X case was tried and convicted, despite his claim that he could not get a fair trial because of the coverage.
Even though Charles Haughey’s trial was postponed indefinitely, Judge Haugh did envisage a time in the future when the impact of the publicity would have died down sufficiently to allow a trial. Haughey did not live long enough for this to come to pass.
Another senior lawyer pointed out that if a bank customer’s confidentiality is breached by the Government, or anyone else, the remedy is to sue the person who breached it. But in the circumstances of this affair the damages would be likely to be minimal.
If the parties are not named by the Government, but come into the public domain through the media, the media would have a very strong public interest defence. This would carry one condition, however – they would need to be very sure the names were correct. A person wrongly named as an investor in these circumstances could have a very strong libel action case indeed.