Anglo in bid to see critical Drumm report
ANGLO Irish Bank is taking its former chief executive David Drumm to court in a bid to force him to release a 'confidential' report that is critical of his actions at its helm.
Mr Drumm (44) has refused Anglo access to the report by former Comptroller & Auditor General John Purcell, which outlines five disciplinary charges against him.
The bank wants access to the report, commissioned by the Chartered Accounts Regulatory Board (CARB), as it plans to sue Mr Drumm for misconduct and deception arising out of a series of controversial decisions and dealings he was allegedly involved in.
It secured an order from a US judge yesterday compelling Mr Drumm to appear in a Boston court on the issue next week.
The dramatic development came as Anglo also indicated in court papers for the first time that it will oppose Mr Drumm's application to be discharged as a bankrupt.
Mr Drumm, who moved to Massachusetts after stepping down from Anglo in late 2008, filed for bankruptcy last October with debts of more than €10m. Anglo is his largest creditor, being owed €8.5m in unpaid loans.
If the bank succeeds in blocking his attempt to be declared bankrupt, it will mean Mr Drumm would not be entitled to any legal protection from his creditors.
His credit record will be permanently damaged and he will not be able to get the "fresh start", which is usually available to US bankrupts within three years of filing for bankruptcy in the US.
In court papers seen by the Irish Independent, lawyers for Anglo said the bank was interested in pursuing four of the five areas of alleged misconduct detailed in Mr Purcell's report.
Anglo has accused Mr Drumm of misconduct and of failing to fulfil his fiduciary duties to the bank through his alleged role in:
- The concealment of €87m worth of loans by former Anglo chairman Sean FitzPatrick.
- Amendments made to loans given to some major customers that made the borrowing non-recourse.
- Changes made to the terms of loans to himself and other executives, where non-recourse language was inserted.
- The granting of a non-recourse loan to Anglo's former finance director, Willie McAteer.
A US court order obliges Mr Drumm to provide Anglo with certain records about his assets and dealings.
However, in court documents, lawyers for Anglo said Mr Drumm had been slow in producing the records it had sought.
In some cases, he hadn't produced the records at all, it was claimed.
Two of the documents that Mr Drumm refused to hand over were his copy of the Purcell report and a written submission he made to CARB.
Lawyers for Mr Drumm told Anglo that he was not at liberty to give them the CARB report as it was confidential.
However, a spokesman for CARB has confirmed that there is nothing in its by-laws that would prohibit Mr Drumm from sharing the report with a third party.
"Put simply, there is a court order requiring the debtor to produce the documents, the debtor has not produced the documents, and there is no excuse for this non-compliance," lawyers for Anglo told the court.
Boston-based judge Frank Bailey will now listen to arguments on the issue next Friday.