As Dire Straits readers know, most of the Club’s $17 million have been put into ME Bank: a BBB rated bank now under investigation by ASIC for its conduct. So much for the bank described by the Secretary at the 2019 AGM as “… a massively reputable bank..” which had not been exposed to the scandals of other banks!
The President has recently taken to emailing selected groups of members with information about many things. He has defended the decision to invest the Club’s last remaining asset so riskily. He asserted that the investment portfolio was “..discussed in detail..” at the AGM. No Brian, it wasn’t. The ‘discussion’ consisted of one member saying that it was “ .. a staggering move to switch from the Big Four with $16 million of Club money..”. When you said the decision had been made “..comfortably..”, another member asked about the current interest rate and you said you didn’t know.
Adroitly shifting blame for investment decisions to the members, Shanahan points out that no resolution was put forward at the AGM to change the disposition of the funds. Well of course it wasn’t! Resolutions cannot be moved from the floor at the AGM as well he knows. So therefore, he argues that the investment in ME Bank should be “..no surprise to anyone..”. Actually, it’s a big surprise to many people. These include:
- those who know that the Audit Committee mandated that investments be with a “big four” bank with an AAA credit rating,
- the majority of members not at the AGM who have heard nothing about proceedings, and
- anyone who has the slightest clue about investing precious and irreplaceable funds.
All of Brian’s emails trying to excuse ME Bank’s behaviour ignore the elephant in the room which is WHY did ME Bank act as it did? He now asserts that ME Bank paid a higher return than any of the big four. Think about it Brian – WHY are they paying a higher rate? Could it be because the risk is higher?
Reviewing the investment portfolio was one of the Audit Committee’s responsibilities. What a pity that, after the second Audit Committee also resigned, it has never been replaced. So who is watching over this investment portfolio? It can’t be the Treasurer because there isn’t one. Has the Committee taken professional advice? Can the members see what kind of advice is being given and accepted about the investment of THEIR resources?
Lack of a Treasurer cannot help with making wise investments. There are now only 8 Committee members and Denis Swift is not amongst them. Since being elected unopposed in October, Denis has disappeared without explanation. That makes him the fourth Treasurer in rapid succession to resign from the Celtic Club – what makes this post so very unattractive to people who know anything about money? After 8 months at least without a Treasurer (which means that the Club is in breach of its own Rules) we now learn that the President is going to appoint another one. Usually, members are asked first to volunteer for Committee vacancies – not any more. Who is this man and what are his qualifications? All we know is that he was ‘Irish born’. As we have all seen quite recently, Irish birth is no safeguard against poor investment decisions.
Repeatedly the President argues that he wants to protect members’ interests. Brian, you have lost almost $13 million in capital value since 2016 and your annual profit/loss figure is rising steadily to about $800,000 last year.
Please write another letter and tell us all HOW you are protecting members’ assets.
(Published with permission from Dire Straits).