Former Anglo director first knew of Sean FitzPatrick loans in December 2008, trial told
A former director with Anglo Irish Bank has told a trial that he first learned of the extent of multi-million euro loans to Sean FitzPatrick in December 2008.
Loans taken out by Mr FitzPatrick (68), his wife and family members increased from about €10 million in 2002 to €103 million in 2007. Mr FitzPatrick, the bank's former chairman, is accused of failing to disclose the loans to auditors.
The prosecution alleges that the amount of the loans was “artificially reduced” for a period of two weeks around the bank's financial end of year statement by short term loans from other sources, including Irish Nationwide Building Society.
Mr FitzPatrick of Whitshed Road, Greystones, Co Wicklow has pleaded not guilty at Dublin Circuit Criminal Court to 27 offences under the 1990 Companies Act. These include 22 charges of making a misleading, false or deceptive statement to auditors and five charges of furnishing false information in the years 2002 to 2007.
On day 64 of the trial Ned Sullivan told the jury that he served on the Anglo board of directors as non-executive director from 2001 to January 2009. He said a non-executive director differed from a executive director in that the former is not employed by the bank.
From mid 2002 to mid 2007 he served on the bank's audit committee. He told John Byrne BL, prosecuting, that he understood that any loans made to directors of the bank were made in the normal course of business and on the same commercial terms as any other lending.
He said he first became aware of the extent of the loans to the accused at a meeting on December 16, 2008. He said Mr FitzPatrick told him about the size of his borrowings and the annual temporary transfer arrangement in place with Irish Nationwide.
He agreed with Bernard Condon SC, defending, that he was not involved in the day to day running of the bank.
Frank Daly, who retired as chairman of the Revenue Commissioners in March 2008, said that in December 2008 he and Alan Dukes were nominated as public interest directors in the bank.
He said the accused asked him to come to the meeting at Heritage House on December 16 with Mr Dukes and Mr Sullivan. At that meeting Mr FitzPatrick disclosed that the accounts being prepared for publication would show an increase in director's loans from €41m in September 2007 to approximately €120m for the financial year ending September 2008.
Mr FitzPatrick said that most of this increase was down to loans to himself. The witness said that the accused described how he would temporarily move the loans out to other banks.
The trial continues before Judge John Aylmer and a jury.