Witnesses
Dara O'Reilly, former financial director of the Quinn Group.
Colin Morgan, former chief executive of Quinn Insurance.
Snapshots
The court sat for just over an hour yesterday as certain issues had to be discussed among the legal teams.
Mr O'Reilly said the Quinn family was "doing what they were told to do" when their contract for difference (CFD) holding in Anglo Irish Bank was unwound in July 2008.
Asked by Paul Anthony McDermott, prosecuting, if businessman Se án Quinn was happy about the unwind, Mr O’Reilly responded: “I don’t think he was . . . His view was that the Anglo stock would recover.” Mr O’Reilly said he didn’t think Mr Quinn’s going along with the proposal was “voluntary”.
Mr O'Reilly was a director of Bazelly, a company owned by the five Quinn children and specifically created to invest in CFDs. Bazelly, incorporated in Madeira to ensure "tax efficiency", began investing in CFDs in 2005.
It initially took positions in a range of financial, oil and mining stocks, but as the Anglo holding increased, the others reduced. Bazelly never bought actual shares, Mr O’Reilly told the court.
The court was told that Mr Quinn provided direction on Bazelly’s investments, which were initially funded from Quinn Group resources.
However, as the “markets took a turn” in 2007, hitting the shares underlying the CFD positions, Bazelly began incurring margin calls from its CFD providers.
Mr O’Reilly said he was aware of a plan agreed between Anglo and Quinn to unwind the CFD position in March 2008. This was to involve placing a proportion of the underlying shares with institutional investors, but it never went ahead.
Mr O’Reilly told the court that his involvement with the actual unwind transaction in July 2008 was limited to the execution of the deal.
He liaised with the investment bank Morgan Stanley and Anglo. He said he did n ot have any knowledge of the Maple 10.
Mr O'Reilly confirmed that he provided the Quinn children with the documentation to sign for the loans from Anglo to buy the shares. Under cross-examination from Lorcan Staines, for Pat Whelan, Mr Staines said it puzzled him that some members of the Quinn family had taken the stand and said they were not aware of the loans until 2010.
“I would have taken my direction either directly or indirectly from Se án Quinn s n r,” Mr O’Reilly responded , but he agreed he did provide the Quinn children with the documentation for signing.
Colin Morgan, who was chief executive of Quinn Insurance until 2010, gave evidence of his role in the preparation of a press release that would announce the Quinn family’s purchase of Anglo shares and the unwinding of their CFDs.
He said he did not know whose idea it was to issue the release or who drafted the original version, but he was asked to circulate it to Morgan Stanley. He agreed to some changes of the first draft, he added, and he would have gotten approval for this from either Mr Quinn or from Liam McCaffrey, former Quinn Group chief executive.
The case was adjourned to next Monday.
