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Central Bank Publishes Details of Settlement Agreement with Former Chairman of Irish Nationwide
The Central Bank of Ireland (“Central Bank”) has concluded its first public settlement, under the administrative sanctions regime, with an individual. A copy of the settlement agreement can be found here.
Dr Michael Walsh, former non-executive Chairman of the Irish Nationwide Building Society (“INBS”) has admitted participating as a non-executive director in certain prescribed contraventions of financial services law by INBS during the period from 1 August 2004 to 30 September 2008. The prescribed contraventions related to the management of commercial loans and credit risk.
Dr Walsh has agreed to a three year disqualification from managing any regulated financial services provider and a €20,000 fine, as part of the settlement. The Central Bank indicated that it took the following factors into account in reaching the settlement.
- Dr Walsh’s participation, as non-executive Chairman of INBS, in INBS’s failure to properly manage its commercial lending and credit risk management in accordance with internal policies.
- The period of time during which Dr Walsh participated in the prescribed contraventions.
- The degree to which his participation departed from the standards expected by the Central Bank of non-executive directors in ensuring the implementation of, and compliance with, management systems and internal controls.
- The need for an effective deterrent impact on other Regulated Financial Service Providers and persons concerned in the management of same, including in particular non-executive directors.
This is the first time that the Central Bank has publicly imposed sanctions on an individual. It is perhaps indicative of the Central Bank’s aim to enhance its regulatory and enforcement powers, bringing it more into line with regulatory regimes in other regulated jurisdictions, as set out in our recent insights article “Central Bank Calls for Enhanced Regulatory Tools to Curb Corporate Offences” which can be found here.
Should you require further information in relation to the material referred to in this update, please contact Joe Beashel, Darren Maher, Karen Reynolds, Claire McLoughlin, or your usual Matheson contact.