Closing arguments commence in Anglo trial

Wednesday 09 April 2014 21.58
Pat Whelan (L), Willie McAteer (C) and Sean FitzPatrick (R) deny the charges
Pat Whelan (L), Willie McAteer (C) and Sean FitzPatrick (R) deny the charges

The jury in the Anglo trial has been told it is legally irrelevant whether or not the financial regulator knew or approved of the lending at the centre of criminal charges in the trial.

Closing arguments are under way in the trial of three former executives accused of giving illegal loans to buy bank shares.

Prosecuting Counsel Paul O'Higgins began his address to the jury this afternoon.

Mr O'Higgins said the key questions for the jury to consider would be whether or not there was lending, if the lending was  "not in the ordinary course of business" and if it was not, did any or each of the accused authorise or permit it.

If they did, he said they are guilty of the relevant offence under the Companies Act.

He said they would not have to consider if they took any reasonable steps to prevent it because none of the accused took "any steps of any kind" to prevent the loans.

Mr O'Higgins said it was "wholly legally irrelevant" whether or not the regulator approved of, permitted, encouraged or was comfortable with the loans.

It was also irrelevant whether or not others should or could have been prosecuted.

The legal advice received by the accused on the lending was also irrelevant, he said.

He also told the jurors they need not consider if people thought the bank would have collapsed - it was not permissible to break the law.

He added: "Good calls or bad calls, whatever... these are not things which have any bearing on the case and don't fall for your consideration."

He said there were no "special prosecution witnesses" in the case.

There was scarcely a detached witness and no one was singing from the prosecution hymn sheet nor were they necessarily singing from the same hymn sheet.

The Maple Ten were chosen for the loans because of the relationship they had with the bank down through the years and their disposition towards the bank was not completely neutral.

He said the Quinns "don't come without an agenda, having had complex legal proceedings taken against them and they plainly have issues with Anglo".

The regulator also "had a corner to protect, they are not people uninvolved in the incident and they are not people unconcerned.

The same could be said of Morgan Stanley and the Department of Finance witnesses who were not without views”.

He reminded the jury of the purpose of the Companies Act and Sec 60, which prevents a company lending money to buy its own shares.

He said it was there so a company will be seen by people buying and selling shares for what it is. The share price should be a true reflection of the company.

He outlined the provisions of another section which provides an exemption to this.

The lending must be in the ordinary course of its business and as Anglo was a bank, lending was its business.

However, it was the prosecution's contention that the Maple Ten loans were "absolutely not" lending in the ordinary way as the loans were for the specific purpose of affecting the share price, using the company's assets.

He said the "purpose and the scale of the loans made it crystal clear it was nothing like ordinary. They were exceptional and extraordinary".

He said the reason why the Maple Ten deal happened was because of fear that the share price might be affected by a sudden unwind of Sean Quinn's CFD position and so that could be averted. 

That meant the shares were not a true reflection of the market.

He also said there was no distinction in law between executive and non-executive directors.

He said none of the accused had taken any steps to prevent the loans.

The duty of the directors was to ensure the provisions of the Companies Act were complied with.

William McAteer and Pat Whelan face 16 charges each of giving illegal loans to people to buy shares in the bank, contrary to the Companies Act.

Sean FitzPatrick, the former chairman, is charged in connection with ten of those loans.

A number of charges have been dropped against Mr FitzPatrick relating to loans to the Quinn family after the judge directed the jury to return not guilty verdicts on the six charges.

The jury was told there was no evidence that Mr FitzPatrick knew about the loans to the Quinns.

The judge also ordered the jury to return not guilty verdicts on seven charges against Mr Whelan relating to the alteration of loan documents.

The closing arguments will continue tomorrow.

Mr Whelan, 51, of Malahide, Dublin, Mr McAteer, 63, of Rathgar, Dublin and Mr FitzPatrick, 65, of Greystones, Co Wicklow deny the charges against them.