Anglo audit committee minutes amended, Drumm trial hears

A former Anglo Irish Bank company secretary has said she amended minutes of an audit committee meeting to include a reference to a transaction with Irish Life and Permanent because she was asked to.

On Tuesday, Natasha Mercer told the jury at the Dublin Circuit Criminal Court trial of former Anglo chief executive David Drumm that the bank's audit committee was an independent watchdog tasked with overseeing management's activities.

She agreed with defence counsel that Donal O’Connor, the bank’s chairman, effectively told her he had discussed the matter with two other executives and they had agreed the minutes should include their recollection a discussion about ILP had taken place.

Mr Drumm (51), has pleaded not guilty to conspiring with former bank officials Denis Casey, William McAteer, John Bowe and others to defraud depositors and investors at Anglo by "dishonestly" creating the impression that deposits in 2008 were €7.2 billion larger than they were.

Mr Drumm, with an address in Skerries, Co Dublin, has also pleaded not guilty to false accounting on December 3rd, 2008, by furnishing information to the market that Anglo’s 2008 deposits were €7.2 billion larger than they were.

Ms Mercer was being cross-examined by Brendan Grehan SC, defending, on day 27 of the trial.

Mr Grehan referred to an email Mr O’Connor sent to her on February 17th, 2009, in which he discussed his recollection of the audit committee meeting on November 18th, 2008.

Mr O’Connor said he participated via conference call from Sydney, “very late at night, on a poor phone line”.

He said he had spoken to Gary McGann and Michael Jacob, who both attended the meeting, and based on all of their recollections, the minutes should state that ILP’s account had been discussed by the committee.

He also said they agreed an additional comment should be added stating that “balance sheet management was normal”.

Mr O’Connor said he was concerned he did not have sufficient awareness of the transactions when he was appointed Anglo chairman on January 1st, 2008.

The court heard he said he was not aware of the “round the houses issue” and had no background in banking.

However, Ms Mercer told Mr Grehan she did not feel under pressure following the email and said his tone was cordial. She told the jury she checked her own handwritten notes, was satisfied the transaction had been discussed and included it in the final version of the minutes.

Last week the trial heard that Mr Drumm accepts the facts of the 2008 transactions between Anglo and ILP but he disputes that they were fraudulent or dishonest.

The trial continues before Judge Karen O’Connor.