Saturday 25 November 2017

Probe into Anglo will drag on until next year

Drumm faces renewed calls to 'grow backbone' and co-operate

Maeve Sheehan

Maeve Sheehan

TAXPAYERS footing the €30bn bill for bailing out Anglo Irish Bank will have to wait until next year to find out whether former boss David Drumm and other key executives will face criminal charges for their roles in its collapse.

Files on the key players including Mr Drumm, who left for the US as the bank collapsed, were sent to the Director of Public Prosecutions by the garda fraud squad several months ago. But it will be next year before anyone could face criminal charges, according to sources.

Mr Drumm has refused to co-operate with the garda investigation. However, the fraud squad has gathered huge volumes of evidence from internal bank documents, correspondence and witness statements.

He could also be facing a second criminal investigation in the US, where he is trying to walk away from €8.3m debts to Anglo by declaring himself bankrupt. He has been accused of providing false information to the court, which is a criminal offence.

The fraud squad's inquiry is focusing on Mr Drumm's role in alleged attempts to secretly bolster the bank's share price by transferring €7.5bn from Irish Life & Permanent, and a scheme in which 10 investors were loaned €450m to buy shares.

Gardai are also probing what role he played in directors' loans of €87m to Sean FitzPatrick, the bank's former chairman, which were concealed from shareholders.

Mr FitzPatrick was arrested in connection with the hidden loans last year.

To date, the only executives to be arrested in connection with the investigation are Mr FitzPatrick and another Anglo executive, Willie McAteer.

Mr Drumm initially emailed detectives promising to make himself available for interview, even suggesting a date. He later reneged on the agreement. The fraud squad is powerless to compel him to co-operate and he cannot be extradited for questioning about an offence.

Mr Drumm can be charged in his absence if the DPP decides that he has a case to answer. Gardai can then ask US authorities to extradite him to Ireland.

Sources this weekend said the Anglo investigation was close to completion with files submitted to the DPP in December and again in May, and at least two more will be sent in the coming months.

The DPP will decide whether charges should be brought once it has received all the investigation files from both gardai and the Director of Corporate Enforcement, which is also investigating the bank. But the High Court was told in July that it could be 2012 before anyone is charged.

As well as facing the wrath of investigators in Ireland, Mr Drumm is under increasing scrutiny in America for allegedly lying about his assets to the American court where he filed for bankruptcy.

As well as presiding over the bank's demise, Mr Drumm left behind debts of €10m including loans of €8m owed to Anglo. When the bank pursued him for the loans, Mr Drumm filed for bankruptcy. He went through rigorous questioning about his finances in a US court and was expected to be discharged from his debt until a fortnight ago.

He is being separately sued by Anglo for alleged misconduct and deception when he ran the bank.

Anglo accused the former banker of repeatedly lying under oath while Kathleen Dwyer, the independent trustee assigned by the court to oversee his bankruptcy petition, joined in, accusing Mr Drumm of making "false oaths" and hiding his assets.

Anglo has also accused Mr Drumm of concealing information from the non-executive board members; and of altering the terms of €450m in loans to 10 investors asked to buy shares in the bank to stem its falling stock price so they wouldn't be personally liable.

Ms Dwyer said Mr Drumm "knowingly and fraudulently made numerous false oaths and accounts". In one instance, he had failed to disclose that he had transferred money to his wife to buy the family home in Boston.

Mr Drumm could face serious consequences in the US if the allegations are found to be true.

Anglo's chief executive, Mike Aynsley, said last week that Mr Drumm will be "actively pursued".

"He needs to get a bit of backbone and come back," he said.

Justice Minister Alan Shatter said people would "draw their own conclusions" from Mr Drumm's refusal to co-operate with gardai.

Sunday Independent

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