LABOUR TD Joan Burton has claimed businessman Seán Quinn tried to buy 25 per cent of Anglo Irish Bank via contracts for difference (CFDs) before buying a 15 per cent stake in the bank with CFDs, investments in which there is no legal obligation to declare an interest in a quoted firm.
Mr Quinn’s spokesman declined to comment on the claim, which Ms Burton made under parliamentary privilege at a meeting of the Joint Oireachtas Committee on Finance and the Public Service.
At a huge loss last year, Mr Quinn and members of his family converted a 15 per cent CFD stake in Anglo into ordinary shares.
Ms Burton criticised the absence of any disclosure requirements in respect of an attempt to buy a significant stake in what was then the third largest bank in the State.
She did not cite any evidence for her assertion or make any further explanation.
“I understand an attempt was made to acquire about a quarter of the bank and then 15 per cent.”
Mary O’Dea, acting chief executive of the Financial Regulator, said: “I can’t confirm that one way or the other.”
The regulator is known to be making proposals to the Government in relation to the disclosure of all CFD investments.
Top officials from the regulator’s office faced repeated criticism at the committee over its failure to detect Anglo’s concealment of loans for former chairman Seán FitzPatrick. The non-attendance at the meeting of the outgoing chief executive, Pat Neary, was also criticised.
Jim Farrell, chairman of the Irish Financial Services Regulatory Authority (IFSRA), said the body “thought it better” to bring the acting chief executive instead of Mr Neary. He said 380 people worked for IFSRA. Its annual budget for 2008 was €58 million.
Asked about the collapse in the value of shares in AIB and Bank of Ireland, he said IFSRA was “completely satisfied with the solvency and liquidity of the two banks”.
On IFSRA’s response regarding its staff to the Anglo loan issue, Mr Farrell said: “We are not implying that anybody was moved or anybody did something wrong.”
Dermot Quigley, an IFSRA director who is investigating how the body handled the Anglo loan issue, said there were undoubtedly legal issues to be pursued arising from its investigation.
Only at the end of the inquiry, expected within weeks, would it be decided what further action would be taken.
On whether the Garda Fraud Squad might become involved, Mr Farrell said: “It will go as wide as it has to go and wherever it leads so be it . . . This will not have defined boundaries.”
After questioning about the role of Anglo’s internal auditors and external auditors Ernst Young, he said “clearly this has to be looked at in some detail”.
Referring to the Irish Auditing and Accounting Supervisory Authority, which monitors auditors, Mr Farrell said: “I’m sure they will be, or they should be, looking into this too.”
Mr Quigley said “the word inappropriate may well have been inappropriate” in respect of the description of Mr FitzPatrick’s loans.
Anglo said the concealment was “inappropriate” but not in breach of banking or legal regulations.
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