A senior banker at Irish Life and Permanent ordered the €7.2 billion transaction with Anglo Irish Bank be documented in case “something goes pop”, a jury has heard.
During a phone call in 2008, Peter Fitzpatrick, ILP group head of finance, asked a colleague if there were “any documents behind this” deal.
Mr Fitzpatrick said ILP would be “massively exposed” if the deal was not recorded, and instructed standard banking language be used, to avoid “f**king confusion in anyone’s mind”.
On Thursday, the jury at David Drumm’s conspiracy-to-defraud trial heard audio of a phone call between Mr Fitzpatrick and Paul Kane, a former ILP liquidity manager, who was giving evidence.
Mr Drumm (51), former chief executive of Anglo, accepts that multi-million euro transactions took place between Anglo and Irish Life & Permanent (ILP) in 2008, but disputes that they were fraudulent or dishonest.
Mr Kane was giving his evidence on day 53 of the trial, at Dublin Circuit Criminal Court.
Paul O’Higgins SC, prosecuting, told the jury the phone call was recorded on Mr Kane’s line on September 30th, 2008.
‘Absolutely satisfied’
“Are we gonna be absolutely satisfied that if something goes pop we can stand over it as a binding agreement?” Mr Fitzpatrick asked Mr Kane.
Mr Kane told Mr Fitzpatrick that he had written confirmation of the amounts of cash placed with Anglo by ILP.
“So if Anglo goes bust next week and a liquidator walks in and he says give me the money back? And we sort of say ah, but like, we had an agreement. He’ll say prove it,” Mr Fitzpatrick said during the phone call.
He told Mr Kane that the deal had to be documented or ILP would be massively exposed.
Mr Kane said he would “get that on the tapes straight away” referring to his phone line, which was recorded for work purposes.
“Use standard treasury speak so there’s no f**king confusion in anyone’s mind and we can stand over it,” Mr Fitzpatrick said.
The jury also viewed an email written by Mr Fitzpatrick to ILP colleagues, approving a €1 billion transaction with Anglo in March 2008.
“To be absolutely clear, this is something which the Central Bank is encouraging us to do,” he wrote.
‘Fairly tight’
He added that the transaction be kept “fairly tight to senior management”.
Mr Drumm (51), of Skerries, Dublin, has pleaded not guilty to conspiring with former bank officials Denis Casey, William McAteer, John Bowe and others to defraud depositors and investors at Anglo Irish Bank by “dishonestly” creating the impression that deposits in 2008 were €7.2 billion larger than they were.
The bank’s former chief executive has also pleaded not guilty to false accounting on December 3rd, 2008, by furnishing information to the market that Anglo’s 2008 deposits were €7.2 billion larger than they were.
The trial has now completed its 10th week and continues before Judge Karen O’Connor and a jury of 10 men and four women.