Formality of trial makes it hard to re-imagine drama
CRIMINAL trials, for all sorts of reasons, have a tendency to take place at a significant remove from the events that give rise to them.
The passage of time and the formalities of a criminal trial sometimes make it difficult to re-imagine the drama surrounding the underlying event.
It is hard to believe, for example, that it is almost six years ago this week that Anglo Irish Bank had its share price slaughtered following the so-called St Patrick's Day Massacre.
The "massacre" followed months of market rumours that businessman Sean Quinn had built up a secret stake in Anglo.
The jury in the trial of three former executives has been told by several witnesses of their shock when it was revealed that Mr Quinn had indeed built up a secret stake using Contracts for Difference (CFDs).
Yesterday the former second-in-command at the Irish Financial Services Regulatory Authority (IFSRA) gave evidence at Dublin's Circuit Criminal Court.
Con Horan, former prudential director at IFSRA, walked the 15-strong jury through that office's knowledge – from a regulatory perspective – in the loan-for-shares scheme to unwind Mr Quinn's stake.
Explaining his reaction, on Good Friday 2008, when he heard that Mr Quinn had built up a stake of some 28pc, Mr Horan said: "It certainly registered with me."
The trial has heard that Mr Quinn's CFD position was a threat to the stability of the entire financial system, one which ultimately led to a scheme being implemented by Anglo to unwind Quinn's stake.
The sixth week of the trial is placing a focus on what the financial regulator knew of the scheme.
Mr Horan said that he understood that the so-called Maple 10 were using their own funds to buy Anglo shares.
David Churton, a legal and compliance executive at Morgan Stanley, which handled the unwinding of the Quinn holding, told the trial that the bank did not seek formal approval from the Irish or UK financial regulators.
Mr Churton said IFSRA was offered the opportunity to raise "red flags" but did not raise any.
If there were red flags to be raised, that fell to Morgan Stanley and to Anglo, according to Mr Horan.
Mr Horan said that the involvement of Morgan Stanley in the transaction provided an assurance for the Irish regulator that "everything would be done properly".
The trial continues and will break on Friday, for St Patrick's Day.