Monday 26 September 2016

Juror in Anglo trial excused after Judge shown doctor's certificate

Declan Brennan

Published 04/04/2016 | 17:08

Left to right, William McAteer, Denis Casey, John Bowe, and Peter Fitzpatrick
Left to right, William McAteer, Denis Casey, John Bowe, and Peter Fitzpatrick

A man has been excused from serving on the jury in the ongoing trial of four former executives from Anglo Irish Bank and Irish Life and Permanent (ILP).

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On day 41 of the trial relating to alleged market deception, a male juror handed a doctor's certificate to Judge Martin Nolan at Dublin Circuit Criminal Court and asked to be excused from the rest of the trial.

The trial began last January with a specially enlarged jury of 15 because it was scheduled to run for five months. It is on schedule to finish next month.

Another juror was excused very early on in the trial and with the latest absence the jury is now 13 strong. At the end of the evidence only 12 members of this jury will take part in the deliberations.

The four accused are alleged to have conspired to mislead investors by setting up a €7.2 billion circular transaction scheme to bolster Anglo's balance sheet in 2008.

Peter Fitzpatrick (63) of Convent Lane, Portmarnock, Dublin, John Bowe (52) from Glasnevin, Dublin, Willie McAteer (65) of Greenrath, Tipperary Town, Co. Tipperary and Denis Casey (56), from Raheny, Dublin have all pleaded not guilty at Dublin Circuit Criminal Court to conspiring together and with others to mislead investors through financial transactions between March 1st and September 30th, 2008.

On the first day of the trial after the Easter break, Kevin Kelly, head of financial reporting with Anglo in 2008, testified that the transactions were brought to the attention of the PWC accounting firm in October 2008 when they were brought in by the Government to review the books of all banks covered by the bank guarantee.

Mr Kelly said PWC included the transactions in a report to the Department of Finance and this report was consistent with his understanding of the transaction at the time. He said the reporting of the transaction by Anglo’s auditors, Ernst & Young (EY), was also consistent with his understanding.

Mr Kelly said that in advance of the auditor’s report he and Colin Goldin, head of Finance with Anglo, drafted a list of matters for discussion that needed to be considered by the bank's Audit Committee.

He told Diarmaid McGuinness SC, defending Mr Bowe, Anglo's then head of capital markets, that this list was shared with Vincent Bergin, the chief auditor with EY.

He was asked by Judge Nolan if he was saying that the Audit Committee were made aware of the exact nature of the September transaction. The witness replied that there was a section in the matters for discussion document that described the transactions.

He told Judge Nolan that if the committee members read that, they would be aware of the transactions.

The trial continues before Judge Nolan and a jury.

Separately the jury were shown a copy of the bank’s preliminary results for the financial year ended September 30, 2008.

Mr Kelly told Úna Ní Raifeartaigh SC, prosecuting, that the published report included balance sheet assets of €14bn under the category of “loans and advances to banks”. He agreed this figure included the €7.2bn placed out to ILP.

The results also included liabilities of €51.5bn under the category of "customer accounts” and Mr Kelly agreed this included the deposits placed by ILP.

He said there was nothing in the notes accompanying the results that would tell the reader that the €7.2 placed with Anglo was linked to the €7.2 loans to ILP.

Elsewhere in the report a statement from Anglo’s then Chief Executive, David Drumm, highlighted the €51.5bn in customer funding.

The statement added: “The goal of our customer deposit business has always been to enhance and diversify the Bank’s funding base, rather than seeking to generate profit.

“Winning new customers was critical to our resilient funding performance. During the year 90,000 new retail customers placed deposits with us, enabling the Bank to maintain our retail balance of €19.2bn. The majority of new customer deposits were of one year or longer.”

The jury has previously heard evidence that the deposits from ILP in September were placed for a short term of a number of weeks.

Under cross-examination from Michael O'Higgins SC, defending Denis Casey, ILP's former CEO, the witness said he had nothing to do with the transaction and his role was to judge how to account for it on the balance sheet.

He said he was informed in October that there was no right of set off, which is a financial facility that sets off one transaction against another, thereby eliminating risk.

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