A former senior official at the Financial Regulator's office has said he did not ask about the identities of wealthy investors who were lined up to buy large stakes in Anglo Irish Bank in July 2008 as he did not think he needed to know.
Con Horan, who was prudential director at the Regulator's office in 2008, also told the trial of three former Anglo directors he was not told when he was briefed on the unwind deal by investment bank Morgan Stanley in July 2008 that Anglo was going to lend to investors in order to buy the bank's shares.
Seán FitzPatrick (65), Greystones, Co Wicklow, Willie McAteer (63), Rathgar, Dublin, and Pat Whelan (51), Malahide, Dublin, have been charged with 16 counts of providing unlawful financial assistance in July 2008 to buy shares in the bank. 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.
The jury yesterday heard that on July 8th, 2008, Mr Horan met Anglo chief executive David Drumm. In a note prepared after this meeting, Mr Horan wrote a briefing note referred to "some discussion as to . . . other alternative such as approaching HNW [high net worth] individuals."
Asked who raised this idea, Mr Horan said he could not recall. “I’m putting it to you that you’d be shouting it from the rooftops if it was Mr Drumm who suggested this,” said Brendan Grehan SC, for Mr Whelan. Mr Horan replied that he “may have raised it” but he could not recall.
Mr Grehan asked him if, on a July 9th phone call with Mr Drumm, he had asked him who the investors were. He replied that Mr Drumm indicated they were Irish and international investors.
Mr Grehan asked Mr Horan if it had occurred to him that Morgan Stanley was taking comfort from the fact that he seemed clearly, in a conference call on July 12th, to be positive about the deal.
Mr Horan said the regulator’s office was “supportive” of the plan, but that he qualified that on the July 12th call, by saying it was up to Anglo and Morgan Stanley to ensure the deal was fully compliant. “So they shouldn’t have taken too much comfort from the conversation with the regulator.”
Mr Grehan said none of the six people who were party to that call said Mr Horan put the onus back on Morgan Stanley and Anglo. “I’m sure that I did,” Mr Horan said.
In evidence on Monday, Morgan Stanley employee David Churton said Mr Horan asked on the call for the identities of the investors.
“I can’t recall asking that,” Mr Horan told the court yesterday. He said people bought shares in banks all the time. “It wasn’t an essential point that we find out who they were.”