SAVERS' RESCUE FUND PUT AT RISK BY SHOCKING FLAWS - A shocking catalogue of mismanagement, breaches of rules and poor oversight has been revealed in a secret report into a multi-million euro bail-out fund run by the country's credit unions.
Some €13m of credit union money was put at risk because of the way the rescue funds were used, according to the report by accountancy firm Mazars. The rescue fund, owned by the Irish League of Credit Unions, is known as the Savings Protection Scheme (SPS), and details about it have never been published before. A copy of the Mazars report, seen by the Irish Independent, outlines a litany of issues. These include how SPS bailout funds were given to credit unions, even though they were not in financial difficulty; missing paperwork; and a failure to follow full and proper procedures. The revelations are set to cause mayhem at this weekend's annual general meeting of the Irish League of Credit Unions. It is the biggest financial scandal to hit the credit union sector since it lost millions of euro on a failed IT system in 2000.
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AIB MOVES TO REPOSSESS 5,709 HOMES FROM THOSE IN ARREARS - AIB had started legal proceedings to repossess 5,709 owner occupied homes in mortgage arrears by the end of last year, according to figures supplied to the Oireachtas finance committee. Another 3,871 private dwelling homes were under threat of repossession at the end of 2014. In addition, AIB started proceedings against the owners of 1,548 buy-to-let investment properties, with another 2,160 cases pending. This high level of potential repossessions was detailed in a questionnaire given to the committee in advance of the bank’s appearance on Wednesday. AIB’s document, which has been seen by The Irish Times, supplied answers to 74 questions from the committee. The document shows that some 26,624 solutions had been offered to its owner occupier mortgage arrears customers by the end of 2014, under the terms of the Central Bank’s resolution targets. Just under one-third of those solutions involved letters being sent to account holders informing them that legal proceedings would be commenced. This does not mean that each property would be repossessed. In many cases, it is designed to flush out strategic defaulters and others who have decided not to engage with the bank on mortgage debt.
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PROJECT TRINITY EARMARKED AT €120m - Sean Dunne’s one-time dream D4 development will today hit the market minus the much-maligned 37-storey tower originally earmarked to adorn the site, says the Irish Examiner. Billed as ‘Project Trinity’ given its location on what was once home to Trinity College’s Botanic Gardens, the 6.8 acres of development land is expected to attract considerable attention from both home and abroad, given its location and development potential. The 400-room Ballsbridge Hotel - formerly Jurys - and 185-room Clyde Court hotel currently trade on the site and will continue to do so unaffected during development. The development is being brought to the market by Savills and Eastdil Secured. The planning permission, valid until December 2021, is for a 1.5m sq ft new urban quarter comprising 490 apartments, a 152-room standalone hotel and 77,000 sq ft of retail and associated commercial and leisure space. The development provides for predominantly high-end residential apartments within a new urban landscape of pedestrian streets and a public plaza.
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US PROSECUTORS CHARGE BRITISH FUTURES TRADER OVER 'FLASH CRASH' - A UK futures trader operating out of a suburban house under the approach path to Heathrow airport has been charged by US authorities for allegedly contributing to the 2010 “flash crash” which saw the Dow Jones Industrial Average plunge more than 600 points in a matter of minutes. Navinder Singh Sarao, 37, of Hounslow, was arrested in Britain, and US authorities are seeking to extradite him to stand trial in Illinois, writes the Financial Times. He was charged with one count of wire fraud, 10 counts of commodities fraud, 10 counts of commodities manipulation and one count of spoofing, a form of market manipulation which involves putting on an order and swiftly withdrawing it before a trade can take place. Mr Sarao could not immediately be reached for comment. The Department of Justice estimates that he made about $40m in total between 2010 and 2014 trading in S&P 500 futures contracts. The flash crash of May 6 2010 led to shares in well-known companies such as General Electric and Accenture trading at just one cent during the mayhem, and thousands of trades were subsequently cancelled. The chaos across US equities exchanges was triggered by a large move in the underlying futures market. The repercussions rattled other markets that trade electronically including bonds and currencies, illustrating the potential risks of a global financial system linked by high-powered computerised trading firms.
