By Andrew Bushe
DUBLIN — The National Irish Bank has made an “unreserved apology” to its customers and more than _131,000 is to be reimbursed to account holders hit by fee-loading of unjustified interest and other charges.
The paybacks to 370 customers follow investigations by the international accounting firm Arthur Andersen and an internal audit, both of which were commissioned by its parent company, the National Australia Group Europe.
The move comes as probe of the bank’s affairs by two High Court inspectors, former Supreme Court judge John Blayney and accountant Tom Grace, is stalled.
NIB staff lost a recent High Court case centered on possible self-incrimination when the inspectors would question them and the verdict is now being appealed to the Supreme Court.
A Garda Fraud Squad probe into the bank is continuing and it is also under the scrutiny of the Central Bank and the Revenue Commissioners.
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Arthur Andersen was called in to report on allegations against five branches of the bank in Carndonagh, Carrick-on-Shannon, Cork, Walkinstown and Blanchardstown.
Their brief was to investigate “whether additional interest was charged to customers without any contractual, statutory or other valid basis” between 1987 and 1993.
According to NIB, they found _100,513 was unsupported by documentation and the NIB team established _4,163 of this was properly due.
The bank is reimbursing the balance of _96,350 “despite the fact that many of these charges were properly due.” It said that in some cases documentation was missing and in others fees were charged as interest.
NIB says its auditors checked interest amendments “across the Bank network with some isolated exceptions” and found that a total of _34,816 “lacked sufficient supporting rationale.”
Ross Pinney, managing director of National Australia Group Europe, said he was satisfied that allegations “have been found to relate to isolated incidences which occurred in the past.”
NIB’s chief executive, Grahame Savage, gave an “unreserved apology” to customers “who had fears raised in their minds about fees and interest charges”.
“We regard any instance of incorrectly applied interest or fee amendments as unacceptable,” he said.