Regulator: Morgan Stanley involvement 'was assuring'
Anglo trial hears evidence from Con Horan
Published 10/03/2014 | 15:44
THE former "second in command" at the office of the Financial Regulator has told the Circuit Criminal Court that it was up to Morgan Stanley and the former Anglo Irish Bank to ensure the so called Maple 10 transaction did not breach regulatory requirements.
Con Horan, former prudential director at the Irish Financial Services Regulatory Authority (IFSRA) said that the the involvement of Morgan Stanley in the transaction provided an assurance for the Irish regulator that "everything would be done properly".
"It was up to Morgan Stanley and Anglo to make sure that all regulatory requirements were adhered to" Mr Horan has told a 15 strong jury at Dublin's Circuit Criminal Court.
Mr Horan, a chartered accountant, was the prudential director of the Irish (IFSRA) in July 2008 when the so called "Maple 10" transaction - to unwind businessman Sean Quinn's stake in the former Anglo Irish Bank - took place.
Mr Horan is giving evidence in the trial of former Anglo chairman Sean FitzPatrick (65), from Greystones, Co Wicklow; former head of risk William McAteer (63), of Rathgar in Dublin; and Patrick Whelan (51), of Malahide, Co Dublin.
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 10 group of investors.
The three men deny the charges.
Mr Whelan, Anglo's former head of lending in Ireland, also denies seven charges of being privy to the fraudulent alteration of a loan facility letter.
Earlier, the trial heard that the office of the Irish Financial Regulator did not "raise any red flags" or "any particular concerns" around the structurecaltrain transaction to unwind businessman Sean Quinn's stake in the former Anglo Irish Bank.
This morning (MON) Morgan Stanley employee David Churton told the trial that Mr Horan - previously described as the "second in command" at the office of the financial regulator - was "effectively comfortable with the stock lending leg" of the transaction to unwind Mr Quinn's stake which had been built up through Contracts for Difference, if this was necessary.
Mr Churton said that he believed that Mr Horan had no objections to the stock lending element of the transaction.
Mr Horan was appointed as head of banking supervision when IFSRA was established in 2003.
He became prudential director in 2006 and reported directly to IFSRA's then chief executive, Pat Neary.
IFSRA was part of the Domestic Standing Group (DSG), led by the Department of Finance.
The DSG, comprised of IFSRA, the Department of Finance and the Central Bank, was established on 2006 to oversee "stability matters" within the State.
The trial, which has now entered its sixth week, continues before Judge Martin Nolan and a jury of eight women and seven men.