IRISH NATIONWIDE Building Society, which is guaranteed by the Government, consulted the Department of Finance before taking its case against developer Liam Carroll to recover €60 million under a personal guarantee.
A spokesman for the department confirmed the society’s management had contacted senior department officials several weeks beforehand to inform them of an action against an individual.
The spokesman declined to name the individual but it is understood to be Mr Carroll, one of the country’s largest developers.
It’s understood that the society asked whether the department had any reservations about the case, and the department advised that the building society should act in the best commercial interests of the institution.
The society’s case came before Mr Justice Peter Kelly in the Commercial Court on Monday.
The court was told that Mr Carroll is challenging the claim, saying that he later only agreed to guarantee €30 million.
The society’s action could trigger further cases against Mr Carroll, whose businesses have come under pressure due to the collapse of the property sector and his investments in quoted firms.
It could complicate plans for the State’s “bad bank”, Nama, which plans to buy €80 billion of developments loans from the institutions. Mr Carroll owes in excess of €2 billion and his main banks are AIB and Bank of Scotland (Ireland).
