The High Court disqualified former National Irish Bank executive director Barry Seymour from managing companies for nine years, finding that serious compliance failures continued during his tenure and that he did not make adequate inquiries or bring potential tax liabilities to the board’s attention.
Mr Justice Roderick Murphy gave judgment on 20 March 2007 in a contested application by the Director of Corporate Enforcement under section 160 of the Companies Act 1990. The application relied on a court-appointed inspectors’ report into National Irish Bank and National Irish Bank Financial Services. The court considered the report alongside affidavits and evidence from Mr Seymour, including two days of cross-examination and re-examination.
The inspectors found that the banks had operated bogus non-resident and fictitiously named accounts, mishandled special savings accounts, promoted insurance policies linked to undeclared funds and improperly charged fees. They attributed responsibility to Mr Seymour for several practices during his 27 months as executive director, from April 1994 to July 1996. The inspectors made no adverse finding against him over improper interest charges, and the court said no responsibility was levied against him for that practice.
Mr Seymour said he inherited long-standing problems, acted to improve compliance and relied on the bank’s systems and experienced staff. He disputed that he knew the extent of the practices and argued that disqualification would be disproportionate. The court acknowledged his efforts and did not assess his conduct with hindsight, but concluded that he knew of recurring DIRT compliance problems and should have taken more decisive action. It found he failed to consider or seek advice about retrospective DIRT liability and did not inform the audit committee or board about the scale of compliance failures and the bank’s potential liability.
The court also found he was aware of deficiencies in special savings accounts and the fee-charging system. It held that his responsibility for the continuation of the Clerical Medical Insurance practice, on its own, was not a ground for disqualification; there was no evidence he could have stopped it. The court’s decision rested on the evidence and inspectors’ findings as a whole, particularly the persistent tax compliance failures and his responsibility for addressing them.
The court assessed the appropriate disqualification period at 12 years before mitigation, taking account of the seriousness of the irregularities and Mr Seymour’s senior position. It then reduced the period by three years, considering his efforts to address the problems, his age and retirement, and his lack of involvement in banking or commercial activity. The order was a company-management disqualification, not a criminal sanction or a ruling on liability for losses.