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Ireland's new hero: a financial regulator

Matthew Elderfield faced down a popular businessman and gave bankers a tongue-lashing.

McDonagh, a plain-spoken native of County Kerry, is displaying a candor to which the once-cozy world of Irish finance world is not accustomed. He castigated the banks for a “reckless abandonment of basic credit risk and prudent lending.” McDonagh also earned popular acclaim for declaring war on the previously rich who have transferred their palatial homes to spouses to avoid seizure.

The reaction to Elderfield's first public appearance since he took up his post in January has been a national sigh of relief that at last full openness has come to corporate Ireland.

Independent Senator Shane Ross, a trenchant critic of Ireland’s bankers, said “the important thing is that he isn’t in the pocket of the government or anyone else.”

Elderfield lectured the politicians on how the boards of Irish banks and insurance companies need to raise their game. He dismissed claims that he was being heavy-handed and acting in haste against the insurance company, saying he gave Quinn every chance to “show me the money.”

(An unnamed director of the Quinn Group told the Irish Times, “The regulators held all the cards. Pennies dropped across the whole system.”)

Elderfield, a veteran of the United Kingdom's Financial Services Authority, will in future veto the appointment of directors to the boards of Irish banks, a mechanism in the past for enriching members of the financial elite. His English accent and no-nonsense approach represents something of a cultural transition in Ireland, made possible by public outrage at the antics of local bank directors, and the feebleness of past regulators. He takes over an office in shambles, mainly due to lack of staff.

Labeled the “Sheriff of Dodge City” by Labour politician Sean Sherlock, Elderfield told the Irish Senate he needed up to 350 more deputies for his financial investigations. In the current climate, the government dare not turn him down.