Gabriel Makhlouf

The written decision of the INBS Inquiry has been published on the Central Bank’s website today along with a market commentary on the outcome.

A former executive board member of INBS, John Stanley Purcell, has been disqualified for four years from being concerned in the management of any regulated financial service provider, directed to pay a €130,000 penalty and reprimanded for his conduct.

Three other former executives have already faced sanctions during the life of the inquiry.

The Central Bank will apply to the High Court to confirm the inquiry decision, as required by law, and it will not take effect unless confirmed.

Gabriel Makhlouf, governor of the Central Bank, said: “The publication today of this inquiry decision concludes an important enforcement action taken by the Central Bank in the public interest.

“It is critical to public trust and confidence in financial services that there is a credible threat of such enforcement for firms and individuals who break the rules put in place to protect consumers and the stability of the financial system.

“The sanctions imposed by the inquiry and through the settlements with INBS and the other individuals highlight the important position of senior role holders and board members in the financial industry.

“The inquiry decision shows the very serious impact failures at board level can have and provides valuable lessons to senior role holders in the financial services industry. It is essential that such key role holders take responsibility for and drive effective risk management and strong governance.”

He continued: “It is a core element of the Central Bank’s enforcement regime and our ability to secure settlements under the administrative sanctions procedure that firms and individuals understand that the Central Bank will follow evidence of breaches through to a full inquiry, as in this case.

“While we rarely use these powers, we will not hesitate to do so if necessary. In doing this, we accept that outcomes are uncertain and we may be challenged. We believe it is our role as regulators of the financial system to take that risk where it is warranted.

“Over the course of this inquiry, we reflected on the lessons we were learning and developed improvements to our internal investigative and inquiry processes.

“The costs of the investigation and inquiry reflect its length — 15 years — and complexity, including the extensive work to unearth the facts through a large volume of documentation and witness evidence, and the need to defend the statutory framework in the face of court challenges by persons under inquiry.

“The lessons learnt have led to changes to the legislative framework, which have introduced efficiencies and further safeguards, including the individual accountability framework.

“The Central Bank will continue to use the full extent of its powers to enforce the rules put in place to protect consumers, the integrity of our markets and the stability of the financial system that serves our society.”