A former loans officer with Guinness Mahon Bank told the Moriarty tribunal he knew nothing about loans of $3 million made through the bank's Cayman Trust to a US citizen, Fernando Pruna, who was later convicted of drug smuggling.
Mr Pat O'Dwyer became loans officer in Guinness Mahon Bank in the late 1970s. He agreed he was aware that certain loans were secured by backing deposits of Guinness Mahon Cayman Trust. He would have been told by Mr Des Traynor there were backing deposits but would not have known anything about securities.
Mr John Coughlan SC, for the tribunal, said Mr O'Dwyer's responsibility was to give effect to the decisions of the credit committee or the board of directors where a loan had been approved.
Apart from loans to US companies, the credit committee used a designation, the words "suitably secured" or similar type words.
Mr Coughlan asked how that was viewed by him.
"I would know that funds were held in Cayman. I would not know how much was held but I would know that the funds were held to back the loan," Mr O'Dwyer said.
Mr Justice Moriarty asked: "Would it be fair to say, Mr O'Dwyer, that when you saw the phrase `suitably secured' or the few other equivalent phrases that we've learned of in tribunal hearings, it effectively was a green light to drop your guard and disregard the normal instincts you'd had as a banker in ensuring that instruments of security were carefully and properly compiled and recorded?"
Mr O'Dwyer replied: "That would be a reasonable assumption, chairman." "And if the loan went west it was somebody else's lookout?" the chairman asked. Mr O'Dwyer said that would be a reasonable assumption as well.
Mr Coughlan referred to the loans made to Fernando Pruna, a US citizen who was later convicted of drugs smuggling. Mr Pruna had been given personal loans and company loans.
Mr O'Dwyer said he knew nothing about them. The tribunal team had told him six weeks ago.
"It was totally, totally foreign to me. I had never heard the name before," Mr O'Dwyer said.
Counsel asked if he was aware there was a court order seeking information from Guinness Mahon Bank about the Pruna loans. Mr O'Dwyer said he was not.
Earlier, Mr O'Dwyer said he became the banking manager of Guinness Mahon Bank in 1974. He said records of offshore holdings were kept but he had no knowledge of how they were maintained. He would receive instructions from Mr Traynor about the drawing of funds.
Mr Coughlan gave an example of an internal memo from Mr Traynor to Mr O'Dwyer instructing that a cheque for £10,000 be made payable to Mr C. J. Haughey dated April 5th, 1977, and was effectively a draft and to debit the Amiens account, an offshore account. Mr O'Dwyer said it was as good as cash.