Bank's audit committee was independent watchdog, Drumm trial told

Bank's audit committee was independent watchdog, Drumm trial told

By Sarah-Jane Murphy

The jury in the trial of David Drumm has heard that Anglo Irish Bank's audit committee was an independent watchdog tasked with overseeing management's activities.

Natasha Mercer, former company secretary at Anglo Irish Bank, agreed with Brendan Grehan SC, defending, that the committee's job was to challenge management if things were not being done in an appropriate manner.

“All members of this committee had substantial accountancy experience and were tasked with acting as a barometer,” she said.

Mr Drumm (51), with an address in Skerries, Co Dublin (pictured below), has pleaded not guilty to conspiring with former bank officials Denis Casey, William McAteer, John Bowe and others to defraud depositors and investors at Anglo by “dishonestly” creating the impression that deposits in 2008 were €7.2bn larger than they were.

Bank's audit committee was independent watchdog, Drumm trial told

The former chief executive of the bank has also pleaded not guilty to false accounting on December 3, 2008, by furnishing information to the market that Anglo's 2008 deposits were €7.2bn larger than they were.

Last week the trial at Dublin Circuit Criminal Court heard that Mr Drumm accepts the facts of the 2008 transactions between Anglo and Irish Life and Permanent, but he disputes that they were fraudulent or dishonest.

On day 27 of the trial Mary Rose Gearty SC, prosecuting, asked Ms Mercer about draft minutes of an audit committee meeting held on November 18, 2008.

The witness said she and Gary McGann, the head of the audit committee, had differing recollections of what was said at that meeting about Anglo's loan of €7.2 billion to ILP in September 2008.

She agreed with Ms Gearty that Mr McGann said he wanted his description of the ILP transactions, which was “customer deposits”, to be included in the final version of the minutes.

On Monday the jury heard that Ms Mercer had not mentioned customer deposits in the draft minutes that she circulated.

“It was a two-hour meeting; the customer deposits were a two minute discussion. It didn't seem like a big area to me at the time,” she said.

Earlier in the trial a juror was released from duty after a note was handed to Judge Karen O'Connor by the forewoman.

“I have released one of jurors for reason that she is acquainted with someone who was referred to during the proceedings,” the judge said.

As three extra jurors had been empanelled at the outset of the trial in January, the case now continues before a jury of 10 men and four women.

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