The High Court refused an application to disqualify former National Irish Bank manager Kevin Curran from company management, finding that although his response to compliance problems was inadequate in several respects, he did not have the authority to bring the bank’s improper practices to an end.
The Director of Corporate Enforcement sought the order under section 160 of the Companies Act 1990, relying on findings in a court-appointed inspectors’ report. The report concerned practices at National Irish Bank and National Irish Bank Financial Services, including bogus non-resident accounts, failures to deduct Deposit Interest Retention Tax (DIRT), the promotion of certain insurance policies, and improper charges to customers.
The Director argued that Curran, first as a regional manager and later as Head of Retail Banking, knew of problems and failed to make adequate enquiries or ensure they were corrected. Curran disputed the inspectors’ conclusions. He said he had relied on branch managers’ assurances, lacked responsibility for bank-wide compliance and policy, and did not have access to relevant records when questioned by the inspectors.
The court found that Curran had received audit reports identifying deficiencies in DIRT-exempt non-resident accounts and had acknowledged suspicions that bogus accounts existed. It concluded that recurring audit concerns should have alerted him to a broader pattern, particularly after a 1993 memorandum from a senior manager raised a sharper focus on compliance. His reliance on branch managers’ assurances was insufficient, and he should have done more, especially after becoming Head of Retail.
On other matters, the court found Curran had taken some action over improper interest loading but had not done enough to secure refunds for affected customers. His efforts to improve the recording of fees were also ineffective. The court found only two instances in which he was involved in matters relating to insurance policies promoted to customers with undisclosed funds, and said his involvement was indirect. It was satisfied he could not have ensured that promotion of those policies stopped.
The court noted uncertainty about whether Curran’s role made him part of senior management, and found no evidence that he was a director or shadow director involved in the bank’s direction or governance. It distinguished his position from that of senior figures who could require compliance and communicate with the Audit Committee or board.
While the court considered Curran’s interventions “dilatory and ultimately ineffectual” and said a more assiduous approach was warranted, it concluded he lacked the authority to stop the practices. Applying the principle that disqualification is intended to protect the public rather than punish, the court declined to make the order sought. The judgment does not impose a disqualification order.