Element of ‘plausible deniability’ to regulator’s role in Anglo deal

Counsel for Seán FitzPatrick says there was a touch of ‘yes minister’ to watchdog’s input

There was an element of “plausible deniability” about the financial regulator’s involvement in an Anglo Irish Bank-Quinn share deal, the trial of three former Anglo directors heard today.

Matt Moran, former chief financial officer with the bank, agreed with Michael O'Higgins SC, for Seán FitzPatrick, that there did seem to be plausible deniability on the regulator's part in relation to a deal made between the bank and the Quinns in March 2008.

Mr O’Higgins asked Mr Moran if “there was a touch of yes minister going on here”.

“It’s difficult for me to comment on that remark,” Mr Moran responded.


“Have you ever heard the phrase plausible deniability?” Mr O’Higgins asked.

He went on to explain this would mean being “involved and controlling” something in some shape or form “but not appearing to be above the water line” and if questions were asked later involvement could be plausibly denied.

“That’s the flavour of what’s happening here?” he suggested.

“That does appear to be the case,” Mr Moran responded.

Mr FitzPatrick (65) of Greystones, Co Wicklow; Willie 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.

Mr O'Higgins highlighted a discussion on or around April 1st, 2008 between Liam McCaffrey of the Quinn Group and the then chief executive of Anglo David Drumm.

He said Mr McCaffrey suggested Seán Quinn would “go long” and buy share stock in the bank before unwinding his contracts for difference - investment products based on share value - in Anglo. But Mr Drumm vetoed that.

Mr Moran said Mr Drumm thought it would be “improper” and the regulator would not approve.

So at the first instance of something suspect, “Mr Drumm put his foot down and said no”, Mr O’Higgins suggested.

Mr Moran agreed.

Mr O'Higgins also asked who Mr Moran believed Matheson Ormsby Prentice solicitor Robert Heron was acting for during the Anglo-Quinn deal.

Mr Moran responded that Mr Heron was to “sit in the middle” between the Quinn Group and the bank. He did not know first hand who made that proposal, the court heard.

Mr O’Higgins asked if Mr Moran had ever known circumstances where “two significant entities” shared a solicitor.

“Ever done business like that before?” he asked.

“No, I haven’t,” Mr Moran responded.

The case continues.

Fiona Gartland

Fiona Gartland

Fiona Gartland is a crime writer and former Irish Times journalist