The High Court refused an application to disqualify former National Irish Bank manager Dermott Boner from company management, finding that his conduct in relation to non-resident accounts, CMI products, fees and interest did not justify an order under section 160 of the Companies Act 1990.
In a judgment delivered on 26 May 2008, Mr Justice Roderick Murphy considered an application by the Director of Corporate Enforcement. The Director relied on findings in a court-appointed inspectors’ report into National Irish Bank and National Irish Bank Financial Services, and alleged that Mr Boner had breached his duties and was unfit to manage a company.
The application concerned practices including bogus non-resident accounts, Special Savings Accounts, the promotion of CMI investment policies, and improper charges to customers. These matters were allegations and findings in the inspectors’ report and submissions to the court; Mr Boner disputed the adverse conclusions and said he had carried out his duties properly.
The court found that Mr Boner, who had been Head of Retail and a senior manager, knew of persistent problems in non-resident accounts and had responsibility for following up internal audit reports. It concluded that he should have been more diligent in overseeing recurring irregularities and considering whether the issues went beyond missing or misplaced paperwork. His failure to make further inquiries, obtain advice or address possible retrospective tax liabilities showed shortcomings in supervision.
However, the judge also considered Mr Boner’s evidence and additional audit documents produced in the proceedings. The court accepted that he had attempted to address issues raised in audit reports, that his responsibilities were more limited while seconded to the College Green branch from February 1994 to May 1995, and that another senior manager had assumed responsibility for verification. It was not satisfied that Mr Boner should have known of the widespread existence of bogus accounts. The additional documents did not eliminate the pattern of non-compliance, but provided evidence of his responses to audit concerns.
The court found that Mr Boner’s involvement with CMI was limited. He had been assured the product was legitimate and, after a customer had difficulty exiting an investment, expressed concern about the product. The judge was not satisfied that his conduct concerning CMI justified disqualification. The court also concluded that his conduct over fees and interest—including practices he acknowledged were improper—did not justify an order, accepting that he had attempted to address the matter.
The Director sought disqualification under three statutory grounds: breach of duty while an officer, conduct making a person unfit to manage a company, and findings in an inspectors’ report supporting unfitness. The court held that the application was not made out on the grounds advanced and refused the disqualification order. The judgment did not make a general finding that the bank’s underlying practices were lawful; it addressed whether Mr Boner’s conduct warranted the specific order sought.