Forged signatures on loan application referred to DPP


ACC Bank Ireland PLC -v- Fahey Ors

Neutral citation.

High Court (Commercial)

Judgment was delivered by Mr Justice Peter Kelly on February 12th, 2010.


ACCBank was entitled to a judgment for €3,273,611 borrowed by the defendants, but not to an additional sum of €711,697 in interest. The bank did not pursue its claim for the interest when it emerged that signatures to a document purportedly by the defendants had been forged.


The four defendants were two couples, George and Catherine McGrath and George and Evelyn Fahey. Mr McGrath and Mr Fahey were involved in a number of businesses together, mainly engaged in buying and developing land and other property.

Mr McGrath, the only one of the defendants to give evidence, was a retired garda aged 53. In 20 years or so he had built up a substantial property portfolio along with a number of business partners, including Mr Fahey. By October 2007, he and Mr Fahey had a combined certified net worth of €25.86 million.

In 2006 they wished to obtain a bridging loan from ACCBank for €3.5 million to assist in buying a property in Loughrea, Co Galway. On May 9th, a letter of loan sanction was sent to them at Mr McGrath’s address. However, it contained a number of inaccuracies, including a wrong address for the property and a statement that it had planning permission, which it did not.

These inaccuracies were pointed out and a fresh letter of sanction was issued dated June 7th, 2006, stating it cancelled and superseded the earlier letter.

On June 13th, €3,273,611 was transferred to the client account of the defendants’ solicitor, being the loan less interest roll-up and administrative charges.

The bank had a letter dated June 7th purportedly from the defendants agreeing to the terms of the loan and stating that the loan became due on June 7th, 2007, one year later. This was further extended until August 2008. By March 2009, the amount owed, including interest, was €4,066,142.

The bank began proceedings in April 2009, which were transferred to the Commercial Court. Before the hearing, each of the defendants swore an affidavit stating that they had not signed the revised letter of loan sanction on June 7th, 2006, that the signatures on it were not theirs and that the first they had seen of it was when they read the grounding affidavit sworn on behalf of the bank.

In a replying affidavit, the bank’s relationship manager, Aidan Corcoran, stated that he could not specifically recall the circumstances surrounding the transmission of the letter.

In opening the bank’s case at trial on February 2nd, 2010, counsel for the bank conceded that the bank was no longer pursuing any claim against the defendants other than the sum transferred to their solicitor’s account. He also accepted that Mr Corcoran’s affidavit was “unsatisfactory”.

The court was told that within a week of an order of Mr Justice Kelly refusing a summary judgment in July, the bank had interviewed Mr Corcoran and a senior manager, Pat O’Callaghan, following which both had left employment with the bank.

Mr McGrath accepted that he was obliged to repay the money transferred to his solicitor’s account. However, Mr Justice Kelly said this was not the end of the matter, as two other issues of concern had emerged.


The first related to a meeting between Mr Corcoran and Mr McGrath during which Mr Corcoran was alleged to have suggested that Mr McGrath tell the bank that he and his wife earned in the region of €107,000.

When Mr McGrath said that the bank would look for a P60, Mr Corcoran is alleged to have said that this could be arranged through an accountant who owed him a favour.

Mr McGrath later wrote to the bank seeking his data and among those furnished was a P60 indicating he earned €89,952.35 in 2005, when his actual earnings as a garda (he was working half- time) were €24,951. A further concern was an e-mail from Mr McGrath to the bank’s solicitor on the eve of the trial, in which he appeared to be threatening the bank with publicity and with action through the courts.

Mr Justice Kelly said he considered it likely this e-mail was sent “with a view to attempting to put improper pressure on the bank to drop its claim”. However, he was not going to hold him in contempt as he considered it was sent out of a sense of desperation.


Mr Justice Kelly said there would be a judgment in favour of the Bank for the €3,273,611 received by the defendants. No interest was being sought by the bank nor was it seeking costs. In view of the disturbing evidence concerning the apparent forgery of the signatures, he was referring the papers to the DPP. He was also asking the appropriate authorities to examine the fictitious P60.

The full judgment is on

Rossa Fanning BL, instructed by Arthur Cox and Co, for the plaintiff; Eoin Garavan BL, instructed by John F Mitchell, Headford, Co Galway, for the defendant.