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Thursday, May 24th 2012

The Illegal Loans with Non-Existent Title Claims that are Sitting on NAMA’s Books

Author: Conor McCabe of Dublin Opinion

Published: January 19th, 2012

Section: Articles, Economy

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I’m working on a paper on NAMA at the moment, but I’ve been so tied up with other stuff that I’m only getting around to reading its 2010 annual report.

It’s incredible stuff.

NAMA actually tells us that a number of the loans transferred in Autumn 2010 have serious title, security and paperwork issues.

But instead of working through these issues, NAMA, in response to a request from Brian Lenihan, simply took all the loans and gave them an estimated value instead.

This is from the 2010 report, p.12:

In response to a request from the Minister for Finance in late September 2010, we arranged for an accelerated transfer, in the last quarter of 2010, of the residual €38 billion using a bulk transfer mechanism with estimated loan valuations. Much of the delay in completing the due diligence has been due to a delay on the part of participating institutions in submitting loan and property information to us.

The information systems of the institutions are generally well below the standard that might be expected for such large oan portfolios; as a result, the effort required to retrieve information from multiple sources, including numerous IT systems, paper files and the corporate memory of bank staff, has been time-consuming.

This difficulty was compounded by the fact that, over the years, legal work and loan documentation had failed to keep pace with the outflow of lending by banks and due diligence work on title and security that ought to have been carried out years ago is only now, belatedly, being completed some four years later. (p.12)

The legal work on a number of these loans is non-existent. NAMA actually put into its annual report that this is the case.

And yet we’re still paying for them.

At the same time NAMA took from the banks a bloc of derivative contracts. These time-bombs are just sitting there in the offices on Grand Canal Street, patiently waiting to explode.

Even after four years of research, the sheer gall of the Irish moneyed class can still make my jaw drop.

They put into the annual report that a substantial number of the loans they bought were dodgy and that the title on the property securing those loans is practically non-existent.

Man they’re not even trying to cover up the theft that’s going on.

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Sins of the Father:

Tracing the Decisions

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