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'Alarm bells are ringing' over a Central Bank whistleblower's allegations

Sinn Féin’s Mary Lou McDonald raised a whistleblower’s claims at the Public Accounts Committee today.

Updated 6.30pm 

24/4/2012. Dublin City Scenes Central Bank (left) in Dublin city centre. Source: Sam Boal/RollingNews.ie

A WHISTLEBLOWER HAS claimed they were asked to remove some negative findings from an internal report by the Central Bank, a TD has said.

The auditor made a protective disclosure to Sinn Féin TD Mary Lou McDonald who today raised the issue at the Public Accounts Committee having passed it on to the Comptroller and Auditor General yesterday.

McDonald said that the former employee was asked to ”omit, delete, amend” a portion of a draft internal audit report in November 2014.

There were discussions on the draft and it was the strong view of the whistleblower that they were encouraged, instructed, to omit, delete, amend certain findings within the draft. So concerned were they, that they made a protected disclosure on 17 November 2014 to Patrick Honohan. The whistleblower had no further involvement with the completion of the report.

McDonald says that the position of the employee began as temporary, but subsequently became a permanent position.

The worker took a case to the Workplace Relations Commission later after his fixed-term contract was not renewed.

McDonald says that the final report that was published in January 2015 found that the bank was not in compliance with good practice in the governance of State bodies.

In a statement issued this evening, the Central Bank said the report identified “some deviations” from its code of practice for governance of state bodies which “were consistent with existing Central Bank policy” as well as “some areas of control weakness which required remedial action”. But the bank added:

These issues were reported to the Bank’s Audit Committee and the majority of these remediation actions have now been completed.

The Dublin Central TD says the report contained details of sub-standard compliance levels in the bank that she described as “troubling”.

The reason I feel that this report is troubling is because we know that a lack of regulation, a lack of oversight, sloppiness, group-think, all of these things were ingredients over the years that led us to a very catastrophic situation.

The Comptroller and Auditor General confirmed that he had discussed the report and McDonald and it he will investigate the matter.

Speaking earlier on RTÉ’s Morning Ireland, McDonald that the report “sounds alarm bells” over corporate governance at the bank.

“Your listeners may say, ‘What does that matter at all? It all sounds a bit mumbo jumbo’.”

I think we all know given our experiences of our economic collapse, of the bust within banks, that proper regulation and strict adherence to the standards are absolutely essential.

31/8/2015 Mary Lou McDonald Dail Scenes Source: RollingNews.ie

“We ought to be able to expect the gold standard from the Central Bank,” McDonald continued, adding that the report appears to suggest this ‘gold standard’ has not been met.

She said the “eye-watering” report finds the bank was partially compliant in the areas of pay, the operation of its board of directors, procurement, and the disposal of assets

“We have a right to expect this stage that the Central Bank is not partially compliant but fully compliant,” McDonald stressed, citing the consensus from the banking inquiry that serious mistakes were made in recent years.

In a statement issued this morning, the Central Bank said:

“The Central Bank of Ireland is not in a position to comment about an issue that is currently before the Workplace Relations Commission.

However, the Central Bank can confirm that issues raised about internal audit (IA) in the Bank were thoroughly investigated last year following challenges raised by a team member.

“Because the matter related to the IA function, the Central Bank appointed an independent external party to fully investigate. The independent external party did not uphold the complaints. The Central Bank has a Confidential Disclosures (Whistleblowing) Policy in place, and places great importance of staff ‘speaking up’ when appropriate.

The Central Bank is satisfied that its actions in relation to this issue have been appropriate.

- with reporting by Rónán Duffy and Hugh O’Connell 

Read: The Central Bank has paid out €230,000 in order to keep key staff, but says they’re not bonuses >

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Nicky Ryan

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