Law prevents market manipulation by banning firms from buying own shares
ANGLO'S former head of risk and the nationalised bank's former managing director in Ireland will be tried before a jury under section 60 of the Companies Act 1963.
Although largely untested in the criminal courts, Section 60 is one of the key rules in Irish company law designed to prevent asset stripping, market manipulation and reduction in the share capital of a company.
It does so by banning any company from buying its own shares.
Section 60 bans a company from giving direct or indirect financial assistance -- including loans or guarantees -- to buy its own shares unless it goes through a triple-lock procedure to ensure that the share purchase is above board.
This process, known as the "whitewash" procedure, includes the holding of a Special Resolution by the company -- where the majority of shareholders approve the share purchase or financial assistance.
It is alleged that Willie McAteer and Pat Whelan unlawfully helped to back a group of investors including members of Sean Quinn's family to buy shares in the financial institution in 2008. The men have not yet entered a plea.
The maximum penalty if found guilty is up to five years in jail per offence and a maximum fine of €3,174.35 per offence.