Garda investigate claims of Nama asset-sale rules breach

Parties connected to a defaulting debtor were allegedly involved in an illegal purchase

The Nama Act prohibits the agency from selling loans or property to a defaulting borrower, or connected parties  .Photograph: Cyril Byrne
The Nama Act prohibits the agency from selling loans or property to a defaulting borrower, or connected parties .Photograph: Cyril Byrne

An Garda Síochána are investigating claims that parties connected to a defaulting National Asset Management Agency (Nama) debtor were involved in an illegal purchase of assets from the so-called bad bank.

Section 173(3) of the Nama Act 2009 prohibits the agency from selling loans or property to a defaulting borrower, or connected parties.

In a response this week to a parliamentary question from Social Democrats TD Catherine Murphy, the Minister for Finance Paschal Donohoe said State-owned Nama is aware that the Garda is investigating an alleged breach of the rule.

“Criminal investigations are a matter for An Garda Síochána and the DPP [Director of Public Prosecutions] and, to date, their investigations have not resulted in a prosecution,” he said.

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A Garda spokeswoman was not in a position to comment, while a spokesman for Nama declined to comment.

“I am advised that Nama has a policy of obtaining written confirmation from purchasers of Nama-secured assets which confirms that, among other things, the purchaser is not a party precluded from completing the purchase by virtue of Section 172(3) of the Nama act,” Mr Donohoe said.

The Minister added that the agency – which took over €72 billion of risky commercial property loans from five bailed-out lenders between 2010 and 2011 at an average discount of 58 per cent – examines these confirmations before a sales deal closes.

Separately, the Minister said that Nama had looked into another alleged contravention of the relevant section but was satisfied that no breach occurred.

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times