#rabbleRaker: Mission Accomplished

In Blog, Politicsby Simon PriceLeave a Comment

Unicredit: Illustration by Laura McAuliffe

Unicredit: Illustration by Laura McAuliffe

It has been three years since Jonathan Sugarman first left comments below an article on the Guardian website. His story has since been raised in the Irish and Austrian parliaments, covered in publications across the EU, German, Belgian and Australian network television, reports have occasionally dotted the Irish media. Simon Price looks at the legal and media response.


The facts; Sugarman resigned as Risk Manager at Unicredit Ireland in 2007 when his reports went ignored by the Irish Central Bank. Unicredit Ireland, a subsidiary of the Italian giant based in Dublin’s IFSC, he found were regularly breaching overnight liquidity by up to 1,900%. In effect the bank was well into the realm of illegality and the Irish authorities did not care. The financial regulator was so indifferent that we can scarcely believe such practice was novel in what The New York Times in 2005 described as “the wild west of European finance”. We know for a fact that Irish attitudes to regulation were and still are central in attracting business to Dublin. The collapse of Depfa Ireland, the same year Sugarman raised concerns, was a product of German bankers doing risky business that would have been verboten in Frankfurt. A world where the integrity of Jonathan Sugarman is not welcome.

The blanket guarantee of 2008 was an Irish decision. One made in interest of those which all decision are made. Conor McCabe has outlined how what is presented as a panic response was entirely in line with national policy while Dearbhail McDonald has described the Anglo nationalisation and recent IBRC liquidation as a “sixty four billion hermetic seal on all the toxicity and filth that lies below”. The last six years are marked by an extraordinary cover up as lifeboats were duly arranged. Only the incompetence of Fianna Fáil in a global and barely manageable financial system threatened to derail it.

Vincent Browne has a long and lone hobby horse on why Ireland’s National Treasury withdrew deposits from Anglo Irish Bank in 2007. In January of that year the extent of Sean Quinn’s gamble started to emerge. Brian Cowen’s diary records meeting with Anglo Director & shareholder Fintan Drury some weeks later while both played golf with Sean Fitzpatrick in May. Anglo, we are told, was never discussed. Officials from the Department of Finance, Central Bank and Financial Regulator, a group who would first discuss a bank guarantee in January 2008, inspected the stability of Anglo Irish Bank in July 2007.

It is around this time that Sugarman first raised concerns with the Financial Regulator. Fourteen months before the collapse of Lehman Brothers a letter was personally delivered to the Central Bank but no action was taken and practice at Unicredit Ireland remained unchanged. Daily liquidity breeches and daily illegality in Dublin. When, on his own initiative, an independent assessment showed breaches to be double first thought, Sugarman resigned.

This is six years ago, in a financial system that has seen collapse, bailout and the IMF come and go. But no one saw it coming. Sugarman for his efforts has been rewarded with hostility and silence. Economists, journalists, politicians and every other stooge who ‘partied’ now preach austerity with impunity. Each and every one are complicit so long as Sugarman is driven to the shadows.

The story has never been told on Irish television. What reached newspapers was never frontpage or migrated to the wider cycle. Only Michael Smith at Village, going so far as to direct ultimatums at the Director of Public Prosecutions, has, so far, stood by him but no one wants to act. Some media owners have as good as crossed the room when approached while Richard Bruton in 2010 privately claimed “we can’t afford the consequences of revealing this story, we already have enough to deal with if we come to power”. Last year Michael Noonan denied there had ever been any contact between Sugarman and Fine Gael. The now Minister Burton follows a similar line.

One notable piece of coverage was Mark Keenan’s rehashing of the story shortly after Denis O’Brien took control of Independent newspapers. Significant here is along with the ousting of Gavin O’Reilly went his acolytes. The chairman of Independent News & Media was Brian Hillary, a former Fianna Fáil Senator and Non-Executive Director at Unicredit Ireland until 2008, after which he was appointed to the Central Bank by Brian Cowen. There is no evidence that Hillary had knowledge or involvement in activity at Unicredit but if this, in it’s timing, was a parting shot at the old regime, we have a good insight into how your news plays in games between billionaires.

From Paul Williams’ Anglo Tapes to Richard Curran on Irish Nationwide there is significant effort to place Ireland’s financial collapse on the actions of rogue and careless individuals. KPMG who earned €49.9m as auditors of AIB and €1.65m at Irish Nationwide have so far picked up €22.29m from NAMA. Arthur Cox represents NAMA (€40,000 a month), Treasury Holdings, the banks, the Department of Finance (€472 an hour) and the winding down of IBRC (€aaargh) . Patrick Neary, the former financial regulator, retired with a pension of €2,750 per week while Governor Patrick Honohan has twice rejected further investigation of the Central Bank. Independent News & Media, Business Post & Examiner have received debt write-offs in the order of millions while Leo Varadkar paid half a million for Ireland.com in a welcome boost for the struggling Irish Times.

As we exit the bailout Jonathan Sugarman remains marginalised in Dublin for refusing to rubberstamp illegality. For everyone else it’s mission accomplished.

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