Quinns say Department of Finance and Central Bank conspired with Anglo
Court told documents amended to disguise department’s knowledge of loans to Quinn
The alleged conspiracy involved the department arranging for documents from Anglo to be “significantly amended”, the family of bankrupt businessman Seán Quinn claim
The Department of Finance and Central Bank conspired with Anglo Irish Bank when advancing more than €2 billion loans to Quinn family companies for the unlawful purpose of propping up its share price, it has been alleged at the Commercial Court.
The alleged conspiracy involved the department arranging for documents from Anglo to be “significantly amended” to disguise the true extent of its knowledge about what was happening in relation to the loans, the family of bankrupt businessman Seán Quinn also claim.
Had regulators done their duty and not encouraged Anglo’s actions, these illegal loans would not have been advanced,
Anglo “would have gone to the wall” much more quickly and the Quinns would not be exposed to claims for €2.34 billion, Martin Hayden SC, for the Quinns, said.
He was applying for orders joining the department and Central Bank, in their capacity as regulators, as co-defendants with Anglo in the Quinns’ action denying liability for those loans. The family are alleging conspiracy, breach of duty and misfeasance in public office against the regulators.
Mr Hayden argued that documents discovered showed officials in the department were aware at “every step of the way” from October 2007 of the difficulties being experienced by Anglo in dealing with the contract for difference positions built up by Mr Quinn in the bank.
Kieran Wallace, special liquidator of Irish Bank Resolution Corporation (formerly Anglo), has opposed the joinder application on grounds including it is misconceived, will fundamentally alter the nature of the family’s case against the bank and make an already complex case more complicated and longer.
Paul Gallagher SC, for IBRC, said Aoife Quinn had in affidavits made many “wild assertions”, some of which were grounded in no evidence at all.
The fact those claims were not denied by IBRC on affidavit did not mean they were accepted and the court was not determining issues of fact, he said.
The Quinns were advancing new claims and causes of action in this joinder application and it was not necessary for the regulators to be joined for the Quinns to advance their case against the bank, he said.
In detailed affidavits, Aoife Quinn claimed the department arranged for documents to be “significantly amended” to disguise the extent of its knowledge that Anglo unlawfully loaned vast sums to support its share price.
Many documents, including material discovered by Anglo, showed the department, Financial Regulator, the Central Bank and Anglo were all aware the bank was loaning huge sums to Quinn companies to meet margin calls on contract for difference positions built up by her father in Anglo,she said.
Mr Hayden read from material including transcripts of phone calls and emails between various Anglo executives; the “O’Connor report” of January 2009 reviewing transactions concerning the Quinn group; communications between Mr Quinn and the bank; minutes of Anglo board meetings and communications with the department and minister of finance.
He also referred to a report of a meeting held at Anglo in March 2009 in which officials from the financial regulator’s office asked Anglo’s former head of compliance, Fiachra O’Neill, about matters including the Quinn transactions.
Mr O’Neill said he was given the head of compliance position in late 2006 despite raising concerns about his lack of banking and regulatory experience.