Quinn assured regulator about his finances
Meeting between Neary and Quinn recalled in court
Grehan SC (Brendan) RE: Three Anglo bankers pleaded not (NOT) guilty to fraud, Dublin Circuit Criminal Court, 6–2-14 Pic shows: Brendan Grehan SC council for Pat Whelan at court yesterday (Wed.) where his cilent has pleaded not (NOT) guilty to fraud.Pic: Courtpix
Inside the first hour of day three of the trial of three former directors of Anglo Irish Bank yesterday, Brendan Grehan SC, defending former Anglo executive Patrick Whelan, introduced the first document to refer to the financial regulator.
Grehan showed the jury a note taken by Andrew Mawdley, of the financial regulator’s insurance division.
The note was of a meeting between Liam McCaffrey, who was in the witness box in court 19 yesterday, Seán Quinn, former chairman of the Quinn Group, and others including Patrick Neary, the financial regulator, and Con Horan, prudential director.
The note dated February 20th, 2008, described Quinn as having “apologised sincerely,” for the trouble he had caused by taking money out of his insurance company to fund his outside investments in shares.
“Anything that was told to the financial regulator from Quinn Insurance Ltd from now on was 100 per cent true,” the note said.
Quinn assured the regulator that his insurance company’s difficulties would be “resolved very quickly,” by share sales and future profits of the group.
The businessman told the regulator it should “accommodate a company that made a mistake.”
The note said Quinn told the regulator his stock market investments were “in good companies with perhaps too much weighting towards the Irish market” .
“It wasn’t quite true was it?” Grehan asked. McCaffrey replied: “There was a number of companies but I am subject to correction.”
Grehan said Anglo’s chief executive David Drumm, and Seán FitzPatrick, its non-executive chairman, had told their board and the governor of the Central Bank, John Hurley, about Quinn’s large position in its shares soon after they became aware of it in September 2007. McCaffrey said he did not know this.
The February 2008 note also said that Quinn expressed concerns that his issues with the regulator had to remain private in case it damaged consumer confidence.
“There was effectively an agreement with the financial regulator not to disclose what was going on?” Grehan asked. McCaffrey agreed.
On February 28th another Central Bank note shown to the jury detailed a meeting between Neary and Horan with Quinn alone.
Neary the note said expressed “concerns” about Quinn and that he knew the businessman was a big borrower from Anglo because of regulatory documents the bank filed in relation to large exposures.
Grehan said the note appeared to quote Quinn as saying in the third person: “Seán Quinn needs to be reined in.”
He also said he was “greedy in relation to CFDs”.
The note stated that Quinn had previously lost money betting on tech stocks in 2001 but he felt he “understood” banks and building stocks better.
Quinn told the regulator that it would be a “mistake,” to sell down his Anglo position in an “uncontrolled manner . . . and this would not be in anybody’s interest.”
McCaffrey said the meeting, which he was not at, was, he believed, a “general review.”
Grehan then showed the jury a document called “Quinn – heads of agreement.” This showed that Quinn from his initial 24 per cent stake in September 2008 had kept buying and he now owned 29.3 per cent or 223 million shares.
‘Restructure’ its debt
Dated March 29th, 2008, the heads of agreement outlines how the Quinn Group would “restructure” its debt with Anglo and repay it.