You remember the cartoon strip Dennis the Menace about the puckish little chap who was always getting into trouble? Well, there's something of the same quality about Ireland's richest man, Denis O'Brien, who is a multi-billionaire and our most powerful businessman. Trouble seems to follow him around like Dennis the Menace's dog.
Our Denis has always been a controversial figure. So it's no surprise that last week's announcement of a Commission of Inquiry into the Irish Bank Resolution Corporation (IBRC) seemed to revolve around him and whatever deals he might have gotten.
He's only one of a number of people who had dealings with IBRC, the entity which was set up to take over and work out the financial mess in Anglo Irish Bank, the institution which led the property madness and played a major part in bringing down the Irish economy. But, fairly or unfairly, O’Brien’s involvement has made it a front page story here for weeks now.
Part of the reason for this was his decision to go to the High Court to get an injunction to stop details of his financial dealings with IBRC being reported in the media. These details, which O'Brien claims are inaccurate, were divulged in the Dail (Parliament) under privilege. He said that, like anyone else, he is entitled to privacy about his banking affairs.
The court decided in his favor, so we had the extraordinary situation that a statement made in our national parliament could not be reported, a situation which caused a furor in the media. (Well, at least in the parts of the Irish media that O’Brien does not own – and he owns or controls a lot of it.)
The other reason it became such an incendiary issue among the public here was that it involved Siteserv, the company that is now installing the hated water meters all over Ireland. Siteserv, which owed a fortune to Anglo and was at the time effectively bust, was sold by IBRC to an O'Brien company at a €119 million loss.
The purpose of setting up IBRC was to sell off the assets behind bad loans and extract as much value as possible from all the bad loans that Anglo had on its books and which cost the Irish taxpayer some €25 billion. The question was, had the deal given to O'Brien been at the expense of the Irish taxpayer? Was it too generous?
In the Dail it was also claimed that O'Brien had some €500 million in overall borrowings from Anglo, and that he had bullied IBRC into giving him a lengthy extension on repaying parts of this and an interest rate that was as low as 1.5 percent. Again the question was whether this was fair to the Irish state and taxpayer or had Denis got a very sweet deal indeed.
After trying to ignore the growing controversy for weeks and side-stepping Dail questions on the matter, the government finally gave in to public pressure last week and announced the Commission of Inquiry, led by a former High Court judge, into the performance of IBRC. The reason was simple. The issue was refusing to go away and could have become a big problem in the run-up to the next election which is now less than a year away.
Putting it before a commission makes it sub judice, which stops all public debate on the matter). Despite being given a December deadline, the commission is most unlikely to report before the election, given the volume and complexity of the material it has to examine (all transactions where there was a cumulative loss of over €10 million). So the delay will solve the government's electoral problem.
Not everyone else is going to be as happy about this as the government. There is widespread public unhappiness about the matter, not least because it feeds off the anger most people here have about the cost of the financial crash being dumped on them, and the suspicion that some powerful people did rather well out of the collapse.
To be fair to the executives who ran IBRC over the past few years, they were given a gigantic financial mess to sort out, a task that would have challenged anyone. Anglo had close to €30 billion in losses. And IBRC was told to get on with it, sort out the mess by writing down debts and selling assets as quickly as possible, maximize the return, and then wind up IBRC altogether. Which is exactly what they did.
The two senior people in the firing line are former IBRC chairman Alan Dukes, once a Fine Gael leader and minister for finance, and former IBRC chief executive Mike Aynsley, an international banker with a lot of experience in sorting out distressed financial institutions. Both men have vehemently denied that they did anything less than the job they were asked to do, within the timeframe they were given.
They do not deny that this meant negotiating with clients and doing deals, and they acknowledge that this meant offering different terms to different borrowers, depending on the quality of assets, whether loans were performing, etc.
In the case of O'Brien, his loans were performing and the tensions that arose were over term lengths and rates. The aim, they said, was to get O'Brien to clear all his debts, which he did.
Much of the controversy here in the past couple of weeks has been over the revelation that senior people in the Department of Finance had been very unhappy with how IBRC was doing its job. Finance Minister Michael Noonan failed to inform the Dail about this in the past few weeks, and there were suggestions that the relevant files had been lost in the department, only to be found again later.
According to Aynsley, the department staff who were demanding meetings with IBRC were out of their depth. None of them had experience in banking resolution work and, besides, IBRC was supposed to be independent to keep its work at arm's length from politicians.
It's hard not to be sympathetic with Aynsley's frustration. This is the Department of Finance, after all, where the top boyos allowed the country to walk into financial disaster and there was not a peep out of them. There is more than a suspicion that the department was trying to retrospectively make up for past failings.
Of course all of this is now water under the bridge. Or to put it another way, it's yet another Irish example of trying to close the stable door after the horse has bolted.
It's what we do here in Ireland. We retrospectively beat ourselves up over previous decisions and actions, setting up tribunals and commissions of inquiry which drag on for months and years, making a lot of lawyers and accountants very rich indeed, before telling us more or less what we knew all along.
The fact is the billions are gone and they ain't coming back.
It's likely that not all of the deals that IBRC struck with its failed borrowers were perfect. But then we don't live in the perfect world inhabited by the lawyers at tribunals and commissions, and the context a few years ago, before our economic recovery started to kick in, was very different. Property prices were on the floor and there was doom and gloom everywhere.
Of far more interest than anything that is likely to emerge from the IBRC Inquiry is what has been going on in NAMA over the past few years. (NAMA, the National Asset Management Agency, was the state bad bank set up to take bad property loans out of the Irish banks so they could function again.)
These days we keep reading about the huge property portfolios of bust Irish developers which were sold to mainly American investment funds a few years ago by NAMA at knock down prices, and which are now being resold at double the money back to Irish investment funds and buyers. Ireland was bought and sold and the vulture funds have made a fortune out of it in a few short years, something we will be examining in this column in detail in the future.
As for our Denis the Menace, apart from screwing the best deal he could out of IBRC, he does not appear to have done anything wrong. But his reputation precedes him.
You will remember that as a young businessman, he made his first pile of cash by getting his hands on Ireland's second mobile phone license, later selling his share for over €300 million. And he avoided paying Irish tax on it by relocating to Portugal.
The Moriarty Tribunal subsequently found that he had been helped in getting the license by bunging around €1 million to the then Minister for Communications Michael Lowry, whose department was overseeing the awarding of the contract.
Despite the evidence produced, O'Brien has always denied this and, of course, tribunal findings are not the same as being found guilty in court. No case has ever been taken against him by the Director of Public Prosecutions as a follow-up to the Moriarty Tribunal findings.
O'Brien went on to make a fortune from his company Digicel, a major cell phone operator in the Caribbean and Central America. He is said to be worth between €5-10 billion today.
In Ireland he is the major shareholder in Independent News and Media, the biggest media group here which runs the Sunday Independent, Irish Independent, Herald, Sunday World, Belfast Telegraph and various local papers, having wrested control in the group from Tony O'Reilly after a bitter battle.
He also owns Communicorp, which runs radio stations in various European countries and almost all radio stations in Ireland apart from those run by the state broadcaster RTE. The combination gives O’Brien enormous media power and makes politicians, journalists and a lot of other people very cautious about challenging him.
On the plus side, he was one of the first people to help after the earthquake in Haiti, where his Digicel company has hundreds of employees, a few of whom were killed in the quake. He poured millions in to help start reconstruction.
He is also known for paying the inflated wages of our soccer bosses, previously Giovanni Trapattoni and now Martin O'Neill and Roy Keane. And he supports good causes like the Special Olympics.
He has other business interests as well, in aircraft leasing, energy (he bought the Topaz oil supply company here out of IBRC and put former Taoiseach [Prime Minister] Brian Cowen on the board!), and several other areas.
No one gets the kind of success our Denis the Menace has achieved in the capitalist world by being an angel. He's probably far from an angel. But no one has proved anything against him in a court of law so far. The commission announced last week by the government is unlikely to change that.