The Irish Bankers' Federation, which represents 50 financial institutions, was aware that a problem existed with bogus non-resident accounts, its president, Mr Kevin Kelly, said yesterday. But he said the federation had no information on the problem's scale.
It was aware of the problem from meetings with the Department of Finance and the Revenue Commissioners. "However, the issue was not relevant for our external auditors - not being an issue related to the accounts of the IBF," he said.
The IBF's concern, following the introduction of Deposit Interest Retention Tax in 1986, was the possibility of an outflow of non-resident funds. "The subsequent outflow of non-resident funds in the years following the introduction of DIRT underscored our concerns in this area," he said.
Mr Kelly added, having gone back over the minutes of the council meetings, that the bogus accounts issue had not been discussed in any great detail.
The IBF met the minister for finance, Mr Ray MacSharry, in advance of the 1988 Budget, to discuss the issue of confidentiality for non-resident accounts and its proposal for self-regulation.
A document submitted to the Public Accounts Committee, dated January, 1988, states that the federation was opposed to the declaration requirement, and the Revenue's powers of inspection, described as "a huge barrier to the growth of non-resident deposits".
"Non-residents are concerned the information can be obtained readily by the Irish revenue authorities and transmitted to other authorities . . .Nothing short of complete confidentiality is likely to change this situation," the document states.
Mr Desmond Byrne, director general of the Irish Mortgage and Savings Association, said non-resident accounts had not come up for consideration in the association's minutes from 1986 to 1998.