Tuesday 6 December 2016

Anglo holds €15m as security on FitzPatrick family debts

Published 24/09/2010 | 05:00

THE €15m deposit that embattled banker Sean FitzPatrick controversially used as security for his family's debts has not left Anglo Irish Bank, the Irish Independent has learnt.

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The deposit deal has come under intense scrutiny this week after it emerged that the High Court official overseeing Mr FitzPatrick's bankruptcy wants the transaction to be investigated.

The deal, struck with Anglo in February 2009, allowed the €15m deposit to be released as security for Mr FitzPatrick's Nigerian oil borrowings and to instead be used to secure the family borrowings.

The result was to reduce the bank's recourse to Mr FitzPatrick's family. In exchange, the bank's one-time chairman granted Anglo superior security over his Nigerian oil interests and any future profits they generated. The family borrowings have been substantially paid down since the deal was struck, meaning they may no longer need the entire €15m as security.



Deposit

Mr FitzPatrick's latest statement of affairs shows he has less than €40,000 on deposit with Anglo, raising the spectre that the €15m has gone outside the bank. It is understood, however, that the deposit has definitely not left the bank.

Its non-appearance on Mr FitzPatrick's schedule of assets could be explained by the way the deposit is now classified, or because the deposit has been used to pay down Anglo debt.

Meanwhile, Anglo is continuing with its efforts to exert maximum security over Mr FitzPatrick's Nigerian oil interests.

Going into the February 2009 negotiations, Anglo held security over the shares of a company that owned a firm that owned Mr FitzPatrick's interest in the Ekeh oil field in Nigeria.

Anglo has improved the security to extend to the company that directly holds Mr FitzPatrick's interest in the oil field. Efforts to further tighten up the security are understood to be ongoing.

Court documents claim Mr FitzPatrick assured Anglo the Ekeh investment would be "very successful" when the bank agreed to the February 2009 deal. Local reports said the oil well was reportedly close to production in November 2009, but subsequent progress is unclear.

Irish Independent

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