Anglo Irish Bank had ‘hotline’ on deal with regulator

The trial of three former Anglo Irish Bank executives has heard there was “a hotline” between the bank and the Financial Regulator about the allegedly illegal Maple Ten deal.

One of the accused, Pat Whelan, told gardaí the regulator’s office was in daily contact with the bank in the run-up to the deal and was given full details of the transactions, including the identities of the Maple Ten.

The former head of the regulator’s office, Pat Neary, previously told the trial he was only told that 10 domestic or international investors were buying the shares. His second-in-command, Con Horan, gave evidence that it was not until the following year that he learned there was lending to the Maple Ten by Anglo.

The Maple Ten were 10 property developers recruited by Anglo to buy 9.4% of the bank’s shares. This was part of a deal to unwind Seán Quinn’s 29.4% control of the bank based on contracts for difference, financial products that allow an investor to gamble on a share price without purchasing the share.

The accused also told investigators that both he and Anglo were comfortable with the lending to the Maple Ten, as it was “in the ordinary course of business” and the bank’s compliance department had raised no objection.

Mr Whelan and his co-accused, Seán FitzPatrick and William McAteer, are charged under section 60 of the Companies Act 1963 of providing funding for the purchase of Anglo’s own shares.

The three men have been charged at Dublin Circuit Criminal Court with 16 counts of providing unlawful financial assistance to 16 individuals in July 2008 to buy shares in the bank. The 16 individuals are six members of the Quinn family and the Maple Ten group.

Mr Whelan has also been charged with being privy to the fraudulent alteration of loan facility letters to seven individuals in October 2008.

Mr FitzPatrick, aged 65, of Greystones, Co Wicklow; Mr McAteer, aged 63, of Rathgar, Dublin; and Mr Whelan, aged 51, of Malahide, Dublin, pleaded not guilty to all charges.

Detective Sergeant Brian Mahon, Garda Bureau of Fraud Investigation, gave evidence of Mr Whelan’s first Garda interview on April 9, 2010.

Det Sgt Mahon told prosecuting counsel Una Ní Raifeartaigh the interview revolved around a report prepared for Anglo’s board by Mr Whelan in January 2009 on the Quinn-Maple deal. The report repeatedly stated that the Financial Regulator was kept “fully informed” about the Maple deal and was anxious for it to proceed.