Seán Quinn admitted he had been 'greedy' at meeting with regulator, court told
Businessman said he needed to be 'reined in' on Anglo, according to regulator’s notes
Liam McCaffrey, former chief executive of the Quinn Group: Mr McCaffrey agreed that the financial regulator was “full square behind” a deal between Anglo and Séan Quinn to buy out Mr Quinn’s interest in the bank’s shares. Photograph: Alan Betson
Businessman Seán Quinn admitted he was “greedy” at a meeting with the financial regulator in February 2008, the trial of former Anglo Irish Bank directors William McAteer, Pat Whelan and Seán FitzPatrick heard yesterday.
Mr Quinn had paid a “very high price for investing in Anglo”, losing “at least” €2.4 billion on the investment, former Quinn Group chief executive Liam McCaffrey said.
Cross-examining Mr McCaffrey, Brendan Grehan SC, for Mr Whelan, highlighted a minute from a meeting between the financial regulator’s office and Mr Quinn on February 28th, 2008.
The minute recorded Mr Quinn as saying “Seán Quinn needs to be reined in and had been greedy” in terms of his dealings with Anglo Irish Bank shares.
Mr McCaffrey said he was not present for that meeting, though he knew about it; and he did not think there had been any outcome from it.
Mr FitzPatrick (65) of Greystones, Co Wicklow; Mr McAteer (63) of Rathgar, Dublin; and Mr 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.
Mr McCaffrey agreed with Mr Grehan that the financial regulator was “full square behind” a deal between Anglo and Mr Quinn to buy out his interest in the bank’s shares. The deal was documented in a memo on March 31st, 2008, and the memo was sent to the financial regulator, the court was told.
It involved the sale of some of Mr Quinn’s interests in the bank. His interests were mainly held as contracts for difference (CFDs), investment products based on share price.
Shares placed on the market
Some of Mr Quinn’s interests were to be placed on the market and “one of the outcomes sought” was that the market price of shares in the bank would not be destabilised, Mr Grehan said. He said this was “in everyone’s interests”, including the financial regulator’s.
The shares were placed on the market in April, but nobody wanted to buy them, Mr Grehan said.
The court was told of a meeting between officials from the financial regulator’s office, Mr Quinn and Mr McCaffrey on February 20th, 2008, about financial problems at Quinn Insurance.
Mr Grehan pointed out that Quinn Insurance’s difficulties did not become public until September that year when the company was fined “a record figure” of €3.5 million by the regulator.
A note taken at the meeting and displayed in court said the regulator was concerned about the company’s financial position and “the replacement of assets with less liquid assets”. This involved the transfer of properties to Quinn Insurance in return for money paid out by the company, Mr Grehan said.
The minute recorded Mr Quinn as having “apologised sincerely for the current financial situation” and for “the problems it was creating for the financial regulator”, and as saying that “anything told to the financial regulator from now on will be 100 per cent true”.
Mr Grehan suggested Mr Quinn was gambling with CFDs. But Mr McCaffrey said he thought gambling was the wrong word. Mr Quinn had been “dealing with a highly leveraged derivative”, he said.
Mr Grehan said the note showed Mr Quinn agreed that €100 million would be put into the insurance company by March 2008 and assets worth €500 million in Prague, Istanbul, Kiev and Russia would be sold.