Ms Derville Rowland:

On the question of outcomes in the enforcement case in Springboard Mortgages Limited, I will volunteer that I was the director of enforcement at the time that we brought and concluded that case. The case was brought under the administrative sanction powers the Central Bank has, whereby we are enabled to bring a case against a person concerned in the management of the regulated entity, where there is evidence to demonstrate that he or she participated in the breach. The Central Bank of Ireland takes the view that it is right to bring individual responsibility and culpability cases as part of the enforcement procedure. However, it can only do so when it has sufficient evidence in a case to sustain that line. Where it does not have sufficient evidence it cannot conclude that.

The Central Bank also takes the view, I think quite rightly, that it is not desirable to go after juniors in a case. There is often a lot of paperwork which is evidence as to who executed a mere task, if I can put it that way. However, that might not be the senior responsible directing mind. I make this as a general observation based on my experience in enforcement cases. I have worked not just in the Central Bank, but in criminal prosecution work in the United Kingdom and in regulatory agencies. It is often easy to find evidence against someone proximate to the issue but that does not get to the directing mind. It does not get to the senior people who are actually responsible and culpable. One needs evidence to link them to the actions of which one is complaining.

The evidential link is more obvious and easier to make when it is in respect to the entity because it is obviously on the watch of the entity that the breach occurred. In the particular case that Deputy Michael McGrath speaks of, no individual was held culpable because there was not sufficient evidence to do so. The Central Bank has four enforcement cases open. The Deputy may have heard the representatives of the Central Bank during our previous updates and he definitely heard there were two cases open, but now there are four cases open. Part of the investigations is to look at the roles at corporate level and then at the responsibility levels of individuals from two perspectives. One is the administrative sanctions procedure, which is persons in management participating in the breach under scrutiny and of course from a fitness and probity perspective. The other part of the regulatory framework is that senior officeholders in regulated entities - we call them pre-approval control functions - must have permission to take up those offices from the Central Bank of Ireland. They must be capable, competent and have the requisite integrity to discharge their function. It was in reference to that the Governor referred to the letters being written to the senior responsible role holders in the lenders reminding them that in those roles, they have reporting obligations. In cases where they suspect breaches, it is very important that they are held to account with respect to that. All of that behaviour will be scrutinised in a forensic way with respect to the individual evidence available in each and every case. Where there is demonstrable evidence that senior responsible role holders were responsible and participated in either breaches of the regulatory requirements or were in dereliction of their duty and the requirements with respect to fitness and probity, those matters will be pursued on an evidence basis. We are firmly committed to the ideology that it is right to hold individuals to account. The work in taking the Irish Nationwide Building Society cases through the courts and through the inquiries demonstrates that we are committed to that.