Partner Michael Muldoon cited in the Sunday Independent in Ireland

Michael Muldoon, one of the partners here at McHale & Co and at McHale Muldoon has been cited in the Sunday Independent in Ireland.

The story read...

"Sunday, February 03, 2013


IRISH banks which sold interest rate swaps could face a compensation bill running into billions of euro — if they are found to have mis-sold the products.

The complex products, which were supposed to protect businesses against interest rate increases when they took out loans — but instead crippled them with hefty payments after interest rates fell — are at
the centre of a major investigation by the British financial regulator, the Financial Services Authority (FSA). As part of its probe, the FSA is investigating the sale of interest rate swaps by the British arms of AIB, Bank of Ireland and IBRC.

Some believe that British banks face a compensation bill of as much as €11.65bn as a result of the FSA probe.

Michael Muldoon, partner with Dublin solicitors, McHale Muldoon, believes Irish banks which sold the products could face a compensation bill of €3.5bn if found guilty of misselling.

The Sunday Independent understands the Central Bank is not currently investigating the sale of interest rate swaps in Ireland.

"The Central Bank is monitoring the issue and we are in ongoing contact with other supervisory authorities," said a spokeswoman.

Eddie Fitzpatrick, director of Bank Check, which investigates overcharging in financial institutions, said that some Irish banks sold interest rate swaps to businesses as a condition of lending.

"Borrowers were encouraged to buy interest rate swaps as a prudent business practice of covering potential losses," said banking consultant Ronan Coburn of The Bottom Line. "The products sold
were generated by the bank''s treasury division — who had the highly specialised knowledge of likely trends in interest rates — compared to the limited knowledge of ordinary business people and companies."

It emerged last week that the owners of Belgard Retail Park in Dublin have sued Ulster Bank over the alleged mis-selling of interest rate swaps totalling almost €54m.

Not all Irish banks sold interest rate swaps."

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