File photo of Michael Fingleton.

Irish Nationwide Building Society

Michael Fingleton mismanaged and ‘gambled’ with Irish Nationwide funds, High Court hears

Liquidators for the Irish Banking Resolution Corporation have taken the case against the former INBS chief.

8.53pm, 6 May 2025

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FORMER BANKER MICHAEL Fingleton’s civil case has opened before the High Court, where it was alleged today that he negligently mismanaged the Irish Nationwide Building Society (INBS) for decades and engaged in property “gambles”.

87-year-old Fingleton, who is in ill health after a stroke, ran the building lender from 1971 to 2009, as managing director and chief executive.

At its height in 2007, INBS had reported assets of €16 billion but was a high-profile casualty of the financial crisis of 2008.

The losses, relating to property loans, had been estimated by the Irish Banking Resolution Corporation (IBRC) at €6 billion.

However, only €250 million in damages is now being pursued by IBRC relating to five loans made by INBS, allegedly approved by Fingleton.

Liquidators for IBRC have taken the case against Fingleton, who denies the allegation of negligent mismanagement.

Fingleton, acting through his wife, Eileen Fingleton and son Michael Fingleton Jr., under their powers of attorney, has made several attempts through court challenges and appeals to halt the case.

The proceedings, originally taken in 2012, finally opened this morning at the High Court.

Lyndon MacCann SC, for IBRC’s liquidators, in opening the case, said INBS operated on a speculation that property could only “go up, and up, and up, and up” and took a “blasé” attitude to warning letters from auditors and the financial regulator.

MacCann said there had been several delays in the case and 1.6 million documents had to be reviewed during the discovery process.

Counsel said the claim against Fingleton was for damages for alleged “profound mismanagement” of INBS, for whom he was the equivalent of the chief executive and director, or “the boss”, for 38 years until his exit in 2009.

Counsel said the claim was “enormous” and that compensation was sought for “huge losses” for the alleged “negligent mismanagement in the stewardship of the society over decades”.

The five loans “approved” by Fingleton relate to property development projects between 2006 and 2008, counsel said.

“The culpability of [Fingleton’s] stewardship regarding these five loans are emblematic of these shortcomings,” claimed MacCann.

The loans relate to three from INBS’s Belfast office and two from its Dublin office that had “myriad” problems regarding safeguards and corporate structures, counsel said.

MacCann said Fingelton “gambled” with the society’s money when he allegedly approved “speculative, risky” commercial loans, which sometimes had already been greenlit by him before they were taken before the board of directors, on which he also sat.

Counsel said that the company would, for a small circle of “high-value” individuals, provide 100% of the purchase price for land. Sometimes, he said, the project may not have planning permission or even zoning.

The return on the loans and interest from INBS was that if the properties could get planning permission, they were to be “flipped” for a profit, making it a “joint-venture” for INBS in profit agreements.

INBS dealt in short-term loans no longer than an initial three years and as short as six months, sometimes without personal guarantee or security in place.

MacCann alleged Fingleton “singularly” failed to live up to his duties of stewardship towards INBS and the five loans “reasonably” should not have been made.

Counsel said that some loan issue instructions would be done orally by Fingleton, while others would be dealt with by a handwritten note at the top corner of an application or letter.

MacCann claimed that during Fingelton’s time at INBS, the defendant never operated a computer, did not send or receive emails and “rarely” wrote letters.

He said this led to an “imprudence” in loan issues which had little or no day-to-day notes, progress assessments, independent valuations or income verification records.

MacCann said the level of power delegated to Fingletion was “extraordinary” and that an expert witness on behalf of the plaintiff will say it was “hideously flawed”.

MacCann said that INBS had been warned by the financial regulator about its “dramatic” move into commercial property away from residential loans as it carries a higher risk.

By 2006, the commercial lending at INBS was 75%, when it had been less than 50% in 2001.

MacCann said that Fingleton had approved the loans before the court and that a handwriting expert will be called in support of the plaintiff’s allegations.

The case before Justice Michael Quinn continues tomorrow and is expected to last up to eight weeks.

The State-run National Asset Management Agency (Nama) took over INBS’ commercial property loans in 2010. The following year, the government merged it with Anglo Irish Bank and established IBRC to take on the finances of both lenders.

r Fingleton was a prominent presence in Irish business during the Celtic Tiger and was reported to have been worth around €75 million in 2006.

However, his son has told the courts that his father is reduced to €25,000 in two personal bank accounts and has outstanding judgment debts of more than €10.7 million.