Nama deal: PAC told former Nama NI adviser 'was in line for £5m'

Nama sold its Northern Ireland property portfolio to US investment firm Cerberus last year

A former Nama adviser was in line for a £5m payment after the sale of Nama's property loan portfolio in Northern Ireland, an Irish parliament (Dáil) committee has been told.

A US investment firm, Pimco, pulled out of the tender bidding process after discovering the fee arrangement to Nama's former adviser, Frank Cushnahan.

The revelation came during a hearing of the Public Accounts Committee (PAC).

It is examining Nama's sale of its 850-property NI portfolio last year.

'Very odd'

The National Assets Management Agency (Nama) is the Republic of Ireland's "bad bank", set up to deal with toxic loans during the Irish banking crisis, and the sale of Nama's Northern Ireland portfolio is known as Project Eagle.

Nama's chairman Frank Daly and chief executive Brendan McDonagh faced questions from Dáil members (TDs) at the PAC hearing on Thursday.

Frank Daly and Brendan McDonagh defended Nama's handling of the NI deal and said they had secured the best outcome for the Irish taxpayer

Mr Daly told the committee that the Pimco bid not go ahead because of the discovery of the involvement of Mr Cushnahan.

He said Mr Cushnahan was to share in a three-way split of £15m with a US law firm and Ian Coulter, who was then a managing partner of Belfast law firm, Tughans.

After hearing the revelation, Independent TD Shane Ross wanted to know how Nama staff reacted at the time.

"It is a pretty startling fact in this process that something very odd is going on," Mr Ross said.

He added: "I would have thought the sequence of events coming up would make you guys think 'this thing stinks'."

'Robust and competitive'

Mr Daly has defended the agency's handling of the bidding process.

Weeks after Pimco withdrew because of its concerns, Nama's loan portfolio sale went ahead to a different bidder, US investment firm, Cerberus.

Sinn Féin's Mary Lou McDonald asked a series of questions during the hearing, and wanted to know if Nama should have had learned more from the Pimco experience.

"In scenario one, there's an attempt at payola. You get wind of it. You get concerned, not concerned enough to suspend the thing but you show Pimco the road," she said.

"Scenario two, you take out the purchaser. That identity changes but lo and behold you've the same cast of characters in and about the final decision."

The Nama chairman told TDs that the sale process for Project Eagle was robust, competitive and secured the best outcome for the Irish taxpayer.

Both Cerberus and Pimco have stated they did nothing improper.

A criminal investigation is under way in Northern Ireland after the discovery of a bank account operated by Mr Coulter in the Isle of Man, containing up to £7m to be paid to so-called fixers and influencers behind the sale.

Tughans said last week that Mr Coulter diverted the money without their knowledge and once they retrieved the funds he left the practice in January.

The Belfast law firm reported the matter to the Law Society.

The Public Accounts Committee (PAC) is questioning those involved in the sale of Nama's Northern Ireland portfolio at the Irish parliament (Dáil) in Dublin