FitzPatrick hoped £250k investment would make money for 'bright young kid'
BANKRUPT former Anglo Irish Bank chairman Sean FitzPatrick intended that any profits from his stg£250,000 investment in a London property would be a chance for a "bright young kid" who joined the bank from school.
Mark Redmond could have made thousands "or nothing, which is what it turned out to be" from the investment which was from a loan funded by Anglo, Mr FitzPatrick told the High Court yesterday.
He was giving evidence about two London property investments as part of an examination into his affairs by the court-appointed official handling his bankruptcy.
He also told the court he paid – from his own money as "gifts" – school and college fees for some Anglo officials' children.
While not wishing to "sound arrogant", he was "quite wealthy" in November 2006 when he decided to invest in the Woolgate Exchange property.
Then aged 23 and from Tallaght, Dublin, Mr Redmond was "not a graduate" and had joined Anglo in 2000 straight from school, he said.
Mr Redmond was working hard and the stg£250,000 investment "was to give him the chance of money".
Mr FitzPatrick said he earlier in November 2006 made a stg£1m investment in Woolgate for his own benefit but the value of that was now "zero". He believed the loans taken out with Anglo for that investment were secured on the property but did not think the security covered the entire stg£1.25m investment.
Under questioning by Kenneth Bredin, for the official assignee administering his bankruptcy, Mr FitzPatrick insisted references in some documents to the stg£250,000 as a "loan" to Mr Bredin were genuine mistakes. Both he and Mr Redmond had the same understanding of the arrangement, he said.
Mr FitzPatrick was declared bankrupt in July 2010.
He and Mr Redmond were yesterday examined in detail about two London property investments organised by property company D2 Private – Woolgate and a Victoria investment – as part of efforts to establish the extent of his estate.
Ms Justice Elizabeth Dunne heard the Stg£250,000 Anglo loan for the Woolgate investment has since been paid off by Anglo from sums totalling about €10m taken by the bank from deposit accounts held by Mr FitzPatrick and his wife.
Mr FitzPatrick told his counsel the €10m was taken without any prior discussion with himself and his wife.
Earlier, he told Mr Bredin he was, in late 2006, Anglo's non-executive chairman having stood down as CEO in December 2004, after which he sold Anglo shares and had "a lot of cash" to make investments.
In November 2006, he considered the Woolgate a good investment. D2 indicated possible returns of about 187pc, he said.
He invested stg£1m on his own behalf prior to telling Mr Redmond he would put in another stg£250,000 for the benefit of Mr Redmond. The arrangement was he, Mr FitzPatrick, would put up the money via a loan from Anglo and put the investment in Mr Redmond's name and take any downside, while Mr Redmond would take any upside.
If anything was to happen to Mr FitzPatrick, it was agreed Mr Redmond would repay the stg£250,000 to Mr FitzPatrick's estate, plus interest, but keep any profit, he said.
He asked Mr Redmond to prepare a note "for my file" to reflect that arrangement. He considered Mr Redmond's typed note was "gauche" in using the word "loan" and in other respects but he signed it.
Mr Redmond said he assisted Mr FitzPatrick in making the Woolgate stg£1m investment. The hearing continues.