Taxpayer hit for tens of millions as FitzPatrick trial collapses
Judge condemns ODCE investigation for its 'inappropriately biased and partisan approach'
The taxpayer is facing a bill running into tens of millions following the spectacular collapse of the trial of former Anglo chairman Sean FitzPatrick.
Mr FitzPatrick's daughter Sarah broke down in court yesterday as Judge John Aylmer directed her father be acquitted on all charges in the third and final criminal trial against him since the financial crisis.
Mr FitzPatrick will face no further charges following a record 126-day trial which is estimated to have cost the taxpayer €3m in legal costs along with tens of millions for the botched probe that led to it.
He had faced 27 charges of misleading auditors and furnishing false information about multi-million euro loans to him and to people connected to him between 2002 and 2007.
The prosecution alleged he misled the auditors about the extent of his loans and arrangements in place to refinance them at Anglo's year end.
However Judge Aylmer stopped the trial before an enlarged jury could consider them. He ruled that the Office of the Director of Corporate Enforcement had adopted "an inappropriately biased and partisan approach" to Mr FitzPatrick's loans case.
The first trial relating to the loans charges ended in May 2015 after solicitor Kevin O'Connell, the ODCE official who led the FitzPatrick inquiry, admitted he had shredded documents after six days of cross-examination in the absence of the jury.
Mr O'Connell became unwell and that case did not proceed.
Mr FitzPatrick was then tried for a second time, that trial ending dramatically yesterday with his acquittal.
In his ruling, Judge Aylmer said that the most fundamental error was the manner in which the ODCE went about taking witness statements from the two main prosecution witnesses, Kieran Kelly and Vincent Bergin of EY, who were the statutory auditors for Anglo.
Judge Aylmer said the statement-making process involved intense negotiations between investigators and A&L Goodbody and resulted in witness statements included in the book of evidence which had been drafted entirely by people other than the witnesses.
Judge Aylmer also said that internal memos showed that the ODCE was trying to build or construct a case rather than to investigate the case independently and impartially.
He said it was conceded by the prosecution that there was a very high degree of suggestion or coaching and contamination by others and cross-contamination in the preparation of the statements.
He said these issues were of grave concern.
Judge Aylmer described the shredding of six documents by lead investigator Mr O'Connell as "extraordinary".
The judge listed the flaws in a five-year-long prosecution as the total lack of investigation as to how letters of representation came into being; a failure to seek out the evidence of those on the audit team actually involved in procuring them; the coaching, contamination and cross-contamination of the auditor's evidence; the partisan and biased nature of the investigation and the shredding of documents by the lead investigator.
He said that given these flaws he was satisfied that "there was a real risk of an unfair trial, incapable of being rectified by directions to the jury and I would have directed them to acquit on that basis".
In a statement, the ODCE said it "fully accepts" the criticisms that both witnesses were coached by the ODCE, contaminating their evidence.
The ODCE said that it had gone through "substantial" organisational change since 2009, had enhanced staffing capabilities, had overhauled its investigative procedures and enhanced its risk management procedures.
It said that the shredding of documents, which could not be reported fully until now, should not have occurred.
"However, they occurred at a time when the staff member concerned was under enormous stress and against a backdrop of significant mental health issues, certain of which pre-dated the incident and which culminated in the staff member concerned being hospitalised for almost two months in the immediate aftermath of those events," it said.
Ex-Anglo chairman faced three trials
TRIAL ONE - April 2014
Sean FitzPatrick is acquitted by a jury of all charges of giving illegal loans to the so-called Maple 10.
TRIAL TWO - June 2015
The jury in Mr FitzPatrick's first trial for his alleged failure to disclose loans to Anglo's auditors is discharged after seven weeks of legal argument in the absence of the jury. During legal argument, it emerged ODCE investigator Kevin O'Connell shredded a small number of documents.
The case was unable to proceed after Mr O'Connell became ill and was unable to attend.
TRIAL THREE - May 2017
After 126 days (the longest-running criminal trial in Irish history), Judge John Aylmer directs an acquittal on all charges in Mr FitzPatrick's second trial for his alleged failure to disclose loans to Anglo's auditors because the investigation by the ODCE fell short of an unbiased, impartial, balanced investigation that an accused is entitled to.