Ex-chairman 'bowing out' before Quinn deal done

FitzPatrick said he believed deal was “kosher” and “above board”

Seán FitzPatrick told gardaí he was in the south of France when he got a call from Mr Drumm on July 9th to tell him they were going to “solve the problem” of Mr Quinn’s holdings in the bank. Photograph: Collins Courts.

Seán FitzPatrick told gardaí he was in the south of France when he got a call from Mr Drumm on July 9th to tell him they were going to “solve the problem” of Mr Quinn’s holdings in the bank. Photograph: Collins Courts.

Fri, Mar 28, 2014, 01:00


Former Anglo chairman Seán FitzPatrick told gardaí he had been “bowing out” of his involvement with the unwind of Seán Quinn’s holdings in the bank before the deal was finalised in July 2008, the Dublin Circuit Criminal Court was told yesterday.

In Garda interviews with Mr FitzPatrick on March 18th, 2010, the ex-chairman said former chief executive David Drumm, was “driving” the deal by late March.

Mr FitzPatrick told gardaí he was in the south of France when he got a call from Mr Drumm on July 9th to tell him they were going to “solve the problem” of Mr Quinn’s holdings in the bank.

By then, Mr Quinn had contracts for difference (CFDs) – investment products based on share price – to the value of more than 28 per cent of the bank’s shares.

Mr FitzPatrick told gardaí Mr Drumm said 10 of the bank’s customers were going to take 10 per cent of the CFDs from Mr Quinn.

He said he asked who the customers were and was told he “didn’t need to know” and they didn’t know each other.


‘Happy’ regulator
Mr FitzPatrick said he asked Mr Drumm if it was “okay” and the chief executive responded that

Anglo was being advised by investment bank Morgan Stanley and the Irish Financial Services Regulatory Authority would “be very happy”.

Mr FitzPatrick (65) of Greystones, Co Wicklow, William McAteer (63) of Rathgar, Dublin; and Pat Whelan (51) of Malahide, Dublin, have been charged with 16 counts of providing unlawful financial assistance to 16 individuals in July 2008 to buy shares in the bank, contrary to section 60 of the Companies Act.

Mr Whelan has also been charged with being privy to the fraudulent alteration of loan facility letters to seven individuals.

All three men have pleaded not guilty to the charges.

Úna Ní Raifeartaigh SC, for the prosecution, read a series of Garda interviews with Mr FitzPatrick into the record in court. They were undertaken on March 18th and 19th, 2010.

Mr FitzPatrick told gardaí when he got the news of the CFD deal he asked if the investors were “people of substance”.

He said he wanted to know if they could afford it or if Mr Drumm was “just taking 10 names” that they could “just put at the bottom of credit” and “they’d never pay it back if things went wrong”.

Mr FitzPatrick said he was told no, they were people of substance.


Quinn CFD situation
Gardaí asked Mr FitzPatrick if Mr Drumm had told him he’d informed the financial regulator of the transaction.

Mr FitzPatrick said he was not sure if he had informed the regulator or if it was Mr Drumm’s belief they would be “very happy”.

“I said what about the regulator and your man said sure they’ll be delighted with it,” he said.

Mr FitzPatrick said he himself had not discussed it with the regulator “good, bad or indifferent”.

He told gardaí he had bowed out of the Quinn CFD situation after a meeting with Mr Quinn in Buswell’s Hotel, Dublin, near the end of March and Mr Drumm was “driving it”.

He said he understood Mr Drumm had been in touch with the regulator.

Asked if Mr Fitzpatrick had any qualms about the bank lending to individuals to buy shares in Anglo, he agreed that he had thought the deal was “kosher” and “above board”.

“Well just think about it. Was he [Mr Drumm] going to go out and do something illegal in what was going to be one of the most publicly looked at deals in Ireland? Why would he do that?” said Mr FitzPatrick.

“You have Morgan Stanley right in the middle of it, advising us. Why would they not say, ‘you can’t do that?’ ”

He said it wasn’t as if Mr Drumm had said, “look . . . this is what I am going to do” and “not talk to anyone about it”.

“If he was going through all of that, it would have been pretty strong stuff to go off and take a chance on that. Why would he want to do that?” Mr FitzPatrick asked.

The remaining interviews with Mr FitzPatrick are due to be read into the record today.