Monday 15 July 2019

Ex-bank chief 'should have been allowed green jersey defence' in €7.2bn fraud trial, appeal told

Appeal: Former banking executive Denis Casey leaving the Four Courts Photo: Collins Courts
Appeal: Former banking executive Denis Casey leaving the Four Courts Photo: Collins Courts

Tim Healy

The financial regulator "raised no quibble" about transactions which deceived people about the true financial state of Anglo Irish Bank in 2008, the Supreme Court has heard.

Counsel for former Irish Life and Permanent (IL&P) chief executive Denis Casey claimed he authorised the transactions on the basis the regulator was fully aware of them and they were encouraged as part of the "green jersey agenda" involving Irish banks supporting each other during the financial crisis.

The claims were made during an appeal by Mr Casey of his conviction for his role in a €7.2bn conspiracy to defraud.

Mr Casey, who attended the appeal before a five-judge court, served a sentence of two years and nine months after he was found guilty of a conspiracy to defraud.

In 2016 a jury at Dublin Circuit Criminal Court found he conspired with Anglo's John Bowe and Willie McAteer to engage in transactions between Anglo and IL&P aimed at fooling people into thinking Anglo had received an extra €7.2bn in customer deposits. The appeal centres on whether Mr Casey was entitled to use the role of the financial regulator, the Central Bank and the Department of Finance as a defence in his trial.

Mr Casey contends he honestly believed that, in September 2008, Anglo could not have approached IL&P for support without the knowledge of the regulator.

That defence of officially induced error was not permitted to go to the jury by the trial judge, who ruled it could only be used in seeking to mitigate a sentence rather than as a defence.

Mr Casey had told the trial, during arguments in the absence of the jury, he did not inform the regulator about the transactions giving rise to his prosecution before they occurred in March and September 2008 with Anglo.

The core legal issue being examined by the Supreme Court is whether or not a defence of officially induced error is available under Irish law to Mr Casey.

If the Supreme Court finds such a defence is available, it will also consider the parameters of that defence and whether, on the evidence, it was open to Mr Casey.

In submissions for Mr Casey, Michael O'Higgins SC agreed with Ms Justice Iseult O'Malley the essence of his case was that the State cannot prosecute or convict Mr Casey for this offence because a State agent got him "into this mess".

The trial judge had accepted, in the hearing in the jury's absence, Mr Casey had given believable evidence asserting he would not have authorised the disputed transfers but for the role of the regulator, Central Bank and Department of Finance, counsel said.

Given the size of the September 2008 transaction leading to Mr Casey's prosecution, and its timing, Mr Casey was confident the transaction would be scrutinised by various "gatekeepers", the Anglo board, its audit committee, internal auditors and its statutory auditors to ensure obligations that the accounts presented a fair and accurate view would be met.

The "green jersey" agenda involved "unashamedly" massaging key elements of balance sheets and, in the case of Anglo, boosting that bank's corporate deposits and the message amounted to "do what you have to do", he submitted.

Paul O'Higgins SC, for the DPP, argued the defence of officially induced error relies on a representation having been made, in advance of the alleged offence being carried out, as to the legality of the alleged offence.

There was no such representation here and the defence was thus not available.

Irish Independent

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