The truth about the AIB bonus scandal finally leaks out.

conorhal

shocking!

And our inept govermnent, until public opinion exploded in it's face, were claiming that these bonues were regretable but inevitable. Well it turns out that they lied.......

http://www.irishtimes.com/newspaper/opinion/2010/1214/1224285490406.html?via=mr

"The official line from both AIB and the Government was that the bonus payments are simply a piece of normal bank business that is being resolved awkwardly late. The sequence of events, as I understand it, suggests something else."

"Instead, the relevant staff were individually called to unexpected meetings with senior managers on January 29th, 2009 – two months before they would normally have been informed of their bonuses. They were told that the bonus for 2008 was being brought forward and would be paid out on February 25th – two months before the normal date. The staff were explicitly told that the meeting they were then having constituted a verbal contract which was legally binding. In other words, senior managers at the bank created a legal obligation to pay the bonuses in AIB as it was effectively being nationalised. Staff were told to keep all of this to themselves.
Not only were the bonuses brought forward, however, they were also unexpectedly large. According to my source: “It was the general view of staff that this was the largest bonus that had been paid in any year by the bank, much to the surprise of employees. However, it was also the [well-informed] belief that this would be the last bonus paid for some time, hence the overcompensation.”
There was a feeling among AIB staff that it was unfair that Anglo Irish Bank staff had been paid bonuses in December 2008 just before the bank was nationalised. It was felt that AIB staff would miss out on the bonus given the intensifying furore."

"Three things need to be stressed. Firstly, there was no existing legal obligation on AIB to pay these bonuses at that time – the “contract” was deliberately created (verbally) by the bank itself in the meetings with staff. (Most of the staff in question had no bonuses specified in their written contracts. It was, as my source puts it, “more the expectation and unwritten rule that staff would be paid bonuses”

I for one an utterly gobsmacked at the amoral hubris of that move... but I really don't know why I'm so surprised.

P. Breathnach

If this is true, then the senior managers involved should be identified and dismissed. No bank should tolerate unethical behaviour by its staff.

sollar

P. Breathnach wrote: »

If this is true, then the senior managers involved should be identified and dismissed. No bank should tolerate unethical behaviour by its staff.

Or prosecuted if needs be

OhNoYouDidn't

sollar wrote: »

Or prosecuted if needs be

Under what law?

Alas, the management of AIB have done nothing wrong, legally or within the spirit of the law.

Drumpot

OhNoYouDidn't wrote: »

Under what law?

Alas, the management of AIB have done nothing wrong, legally or within the spirit of the law.

But is that true or just something hard to prove?

If it transpires that what O'Toole wrote is accurate and probable, is it not illegal to add further liabilities on an insolvent company, that is being bought by a governent to save its ass ?

I have to believe that the motivation and subsequent actions of the banking officials to "ringfence" the legal requirement for the bonus's to be paid, to be certainly not "in the spirit" of the law.

OhNoYouDidn't

Drumpot wrote: »

But is that true or just something hard to prove?

If it transpires that what O'Toole wrote is accurate and probable, is it not illegal to add further liabilities on an insolvent company, that is being bought by a governent to save its ass ?

I have to believe that the motivation and subsequent actions of the banking officials to "ringfence" the legal requirement for the bonus's to be paid, to be certainly not "in the spirit" of the law.

Spirit of what law?

Thats my point...

Elevator

one law for them and one for the rest of us.

PeterIanStaker

RTE/Pravda making St Lenihan the Knight in Shining Ordure out to be some kind of hero, valiantly intervening to stop these bonuses

[Sarcasm]ohmygod isn't he great maybe FF are ok sure I'll vote for them[/Sarcasm]

- only thing I find "galling" about this is the hypocrisy:

http://www.rte.ie/news/2010/1214/anglo_aib.html

Rebelheart

conorhal wrote: »

shocking!

And our inept govermnent, until public opinion exploded in it's face, were claiming that these bonues were regretable but inevitable. Well it turns out that they lied.......

http://www.irishtimes.com/newspaper/opinion/2010/1214/1224285490406.html?via=mr

"The official line from both AIB and the Government was that the bonus payments are simply a piece of normal bank business that is being resolved awkwardly late. The sequence of events, as I understand it, suggests something else."

"Instead, the relevant staff were individually called to unexpected meetings with senior managers on January 29th, 2009 – two months before they would normally have been informed of their bonuses. They were told that the bonus for 2008 was being brought forward and would be paid out on February 25th – two months before the normal date. The staff were explicitly told that the meeting they were then having constituted a verbal contract which was legally binding. In other words, senior managers at the bank created a legal obligation to pay the bonuses in AIB as it was effectively being nationalised. Staff were told to keep all of this to themselves.
Not only were the bonuses brought forward, however, they were also unexpectedly large. According to my source: “It was the general view of staff that this was the largest bonus that had been paid in any year by the bank, much to the surprise of employees. However, it was also the [well-informed] belief that this would be the last bonus paid for some time, hence the overcompensation.”
There was a feeling among AIB staff that it was unfair that Anglo Irish Bank staff had been paid bonuses in December 2008 just before the bank was nationalised. It was felt that AIB staff would miss out on the bonus given the intensifying furore."

"Three things need to be stressed. Firstly, there was no existing legal obligation on AIB to pay these bonuses at that time – the “contract” was deliberately created (verbally) by the bank itself in the meetings with staff. (Most of the staff in question had no bonuses specified in their written contracts. It was, as my source puts it, “more the expectation and unwritten rule that staff would be paid bonuses”

I for one an utterly gobsmacked at the amoral hubris of that move... but I really don't know why I'm so surprised.

Thanks for posting this. Totally escaped my radar. I definitely agree that all AIB managers responsible for this should be named. I assume they've all been sacked anyway, of course.


of course?

Liam Byrne

Smells a little like the "sign off on Tara before it can be changed" stunt that FF & The Greens themselves pulled in 2007.

Sickening doesn't even cover it, and I'm getting gladder by the day that I have no more dealings with AIB - at least by choice, because FF have unfortunately ensured that I part-own them even though I'd prefer to own a leaky septic tank.

thebman

He repeated that he has great confidence in AIB's Executive Chairman David Hodgkinson and the board of the bank.

Read nobody will be held accountable for this and the Irish government will still hold hands with the bank and organise dinner parties with them at the tax payers expense.

Is he actually that stupid that he believes anyone cares if he believes in this guy given we don't believe in him or anyone associated with him at this stage?

Liam Byrne

thebman wrote: »

Read nobody will be held accountable for this and the Irish government will still hold hands with the bank and organise dinner parties with them at the tax payers expense.

Is he actually that stupid that he believes anyone cares if he believes in this guy given we don't believe in him or anyone associated with him at this stage?

Given some of the scheisters and con-men that FF have "voted confidence in", including themselves, and the fact that FF have zero credibility, the only meaning that statement can have is

1) We won't even attempt to put someone worthwhile in place who'll work in the best interests of the country

2) Nobody will be held accountable for any actions relating to crap and ill-advised decisions - except, of course, for the taxpayer / citizen whom we will force to foot the bill for all disastrous decisions by both ourselves (FF) and the banks and the others who frequented the ruinous Galway Tent

Considering that Lenihan has declared himself "proud of his decisions" and "believes the Irish people are behind him", the guy is obviously deluded.

LittleBook

In the legal case that followed, AIB did not put up a defence. Such a defence would in all probability have revealed what actually happened – that the bonuses had been brought forward to make them a fait accompli before the Government recapitalisation.

Stomach churning stuff, but this is the worst part. Whatever about what happened back in early 2008, it clearly shows that nothing whatsoever has changed in AIB. It is the current management who failed to present a defence this year.

OhNoYouDidn't

It depends which way you look at it.

If Lenihan wrote to them as the major shareholder in the bank protesting at a decision and threatening consequences, then there isn't a lot to see here. This happens all the time in the real world.

I despise the man and his party, but he played this one well.

Sand

Just demonstrates the extent to which banks have been taken over by their employees. We should have left AIB to fail, so a better bank could emerge - instead we have ensured that the corrupt AIB culture of ripping off its customers and shareholders will continue to plague us for another generation. The fact that this is totally legal and above board under Irish law is itself revealing.

ebbsy

Goodbye Brian.

Muppet.

Liam Byrne

OhNoYouDidn't wrote: »

It depends which way you look at it.

If Lenihan wrote to them as the major shareholder in the bank protesting at a decision and threatening consequences, then there isn't a lot to see here. This happens all the time in the real world.

I despise the man and his party, but he played this one well.

Unfortunately he played it 2 years too late; he still let the former heads that presided over this off with their undeserved fortunes and payoffs.