Regulator official says he believed investors were paying for Anglo shares themselves

A former senior official at the Financial Regulator's office has said he believed wealthy investors were going to pay for Anglo Irish Bank shares from their own funds as part of a share-buying scheme.

Con Horan, former prudential director at the office, yesterday told Dublin Circuit Criminal Court he raised no objections to the outline of a plan to unwind businessman Seán Quinn’s large contract for difference (CFD) stake in Anglo, by selling the shares to members of the Quinn family and a number of investors.

Mr Quinn’s large bet on Anglo through CFDs – investment products based on share price – was felt to be destabilising the bank.

Giving evidence at the trial of former Anglo directors, Mr Horan said he was told of the plan in a call from Anglo chief David Drumm on July 9th, 2008. He said Mr Drumm told him the bank might provide short-term lending where investors had a cash flow issue. "These were high-net worth individuals . . . ," he said.

Mr Horan told defence counsel Brendan Grehan SC he only became aware of the extent of the Quinn CFD position when it was 28-29 per cent: “It was a very, very serious situation.” Mr Grehan said Mr Horan’s account had gained a “lot of detail” since a statement to gardaí in 2009.