FitzPatrick loans covered by other bank before end of Anglo financial year

Jury shown 10 credit applications approving and extending loans ranging up to €100m

Seán FitzPatrick:  his loans were used to finance  the development of shopping centres, hotels and offices. Photograph: Alan Betson
Seán FitzPatrick: his loans were used to finance the development of shopping centres, hotels and offices. Photograph: Alan Betson

It was "no secret" that multi-million euro loans taken out by former Anglo Irish Bank chairman, Seán FitzPatrick, were paid by another bank in the run-up to Anglo Irish Bank's end of financial year, his trial has heard. Mr FitzPatrick (68), Whitshed Road, Greystones, Co Wicklow, is accused of misleading auditors about loans between 2002 and 2007.

He has pleaded not guilty to 22 charges under the 1990 Companies Act of making a misleading, false or deceptive statement to auditors and five charges of furnishing false information in the years 2002 to 2007.

Dublin Circuit Criminal Court heard evidence on Friday from Joe McWilliams, who was appointed to the role of lending director in the bank in 2006. He was a co-signatory on a number of loans taken out by Mr FitzPatrick and other family members between 2006 and 2007, the court heard.

The jury was shown 10 credit committee application forms from May 2006 to November 2007 approving and extending loans in values ranging up to just over €100 million. By November 2007, Mr FitzPatrick had drawn down just over €103 million and his limit was increased to €120 million, the court heard. The then Anglo Irish Bankchief executive David Drumm was one of the signatories on one loan application in September 2007.

READ SOME MORE

Mr McWilliams agreed with Dominic McGinn SC, prosecuting, who said that at the time he was “aware of an arrangement whereby another bank covered the repayment of Seán FitzPatrick’s loans prior to Anglo Irish Bank’s financial year end. “That Anglo facility remained in place. The facility was drawn down again after year end and the other bank was paid.” Facility was another word for loan, the jury was told.

The court has previously heard that Mr FitzPatrick’s loans were used to finance the development of shopping centres, hotels and offices at a time when a lot of money could be made in property development.

The jury has been told the trial is about the alleged failure to disclose the extent of Mr FitzPatrick’s loans to the bank’s auditors, Ernst & Young.

Bernard Condon SC, defending, put it to Mr McWilliams that he was aware of an arrangement whereby another bank was “permitted to repay Seán FitzPatrick’s loans prior to Anglo’s financial year end” before he took on the role of lending director. “You were aware of this. That was no secret. Everybody knew about it,” Mr Condon said. Mr McWilliams agreed this was the case.

The trial continues on Monday.