Social Democrats TD alleges IBRC accepted personal guarantee from businessman despite concerns
The Dáil has heard new allegations about businessman Denis O'Brien's relationship with the former Anglo Irish Bank.
Speaking under Dáil privilege, Social Democrats TD Catherine Murphy claimed IBRC accepted a personal guarantee from the businessman to issue a loan to a property developer, despite having concerns about existing loans to both men.
Deputy Murphy claimed Mr O'Brien acted as a guarantor in order to secure a bridging loan for Paddy McKillen, when both owed large amounts to the bank.
She said the proposal was brought to the bank by Richard Woodhouse, an IBRC executive who managed Mr O'Brien's accounts with the bank.
Mr McKillen sought a bridging loan of €5 million from IBRC in 2012 when he had a cash flow problem following unsuccessful legal action against the Barclay brothers, according to Deputy Murphy.
"As part of that process, Mr Richard Woodhouse, a man connected with the Siteserv sale and Mr O'Brien, advised members of the IBRC, including Mr Aynsley and Mr Tom Hunerson - people connected directly with the Siteserv deal - that Mr. O'Brien would provide IBRC with a guarantee of €5 million to support the loan for Mr. McKillen," she said.
"Astoundingly, despite serious concerns from some about Mr McKillen's ability to repay the amounts he owed IBRC - far in excess of €5 million - the bridging facility was granted.
"Essentially, a man with huge debts to IBRC was granted a loan from the IBRC on the guarantee of another man who owed significant sums to IBRC while there were questions over both men's financial ability to fulfil original loan agreements with IBRC.
"Those making the decision were directly connected with the Siteserv deal and other transactions.
"Some of the larger transactions, such as those in excess of €10 million or €100 million, may be more straightforward than some of the smaller transactions that could give us some sort of better understanding of the relationships in the bank."
Deputy Murphy made the claims during a debate on legislation to grant extra legal powers to the inquiry into IBRC transactions.
The Cregan Commission of Investigation was set up on the back of allegations about the €45 million sale of Siteserv to a company controlled by Mr O’Brien. The purchase came with a write-down of €110 million in debt.
The IBRC investigation has been charged with examining over 30 transactions at the state-owned bank where there was a capital loss of at least €10 million.