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Monday 10 February 2014

Seán Quinn takes witness stand at Anglo trial

Businessman Seán Quinn has told the Anglo trial he believed he was investing in a blue-chip investment in Anglo Irish Bank when he first became interested in it in 2006.
The trial is continuing for a fourth day at the Dublin Circuit Criminal Court of the former chairman of Anglo Irish Bank and two former Anglo executives.
They are charged with providing unlawful financial assistance to 16 people to buy shares in the bank.
Seán FitzPatrick, 65, from Greystones in Co Wicklow, 51-year-old Patrick Whelan of Malahide in Dublin and 63-year-old William McAteer of Rathgar in Dublin have pleaded not guilty to the charges.
Mr Whelan has also denied seven charges of being privy to the fraudulent alteration of a loan facility letter.
Mr Quinn said believed Anglo was a marvellous institution and was regulated by the Government.
However, he said it was now public knowledge that Anglo knew it was in trouble as far back as 2007 and he would never have bought one share in the bank if he had known.
He said the bank proceeded to put borrowed money into the names of his family when it knew it was in trouble.
He said he never meant to get in as deep as he did.
He went to dip a toe in the water but ended up feet, head, neck and heels into the water.
He said he decided to invest in the bank but did not decide how it was to be done - through high risk Contracts for Difference.
He denied deliberately building up a stake in secret but accepted that it was under the radar.
He said loans given by Anglo to fund margin calls on the CFDs - money owed to brokers when a share price drops - were not so much loans as Anglo doing something for its own benefit. 
He did not ask for the loans but was happy when they were offered because he had been funding margin calls from Quinn group profits and later inter-company loans from Quinn Insurance and the money was needed to fill a hole.
"I'm not saying he forced this money on me but I was happy to take it," he said.
He denied he had Anglo "over a barrel" but said "he [David Drumm] had him over a huge barrel. It was taking €400m to sort out the problem and fill the hole."
The trial has previously heard that Anglo was concerned about Mr Quinn's significant stake as it was dangerous for the share price for one person to have such a sizeable investment.
He said at one point he sought assurances from the regulator and from Anglo about the bank's position because he was concerned about the share price dropping.
He said his CFD position was mentioned at a meeting with the Financial Regulator who was "very cautious" about revealing his knowledge about Anglo and was "on a fishing exercise" at the meetings.
The decision to unwind his stake using loans from Anglo to the Quinn family to buy up the shares was not his, he said.
The bank was in control and told him so in no uncertain terms.
He said he later took legal advice because he was concerned about "some sort of sweetheart deal" having taken place.
However, at a meeting with bank officers he was told the bank was in rude health and "they would all live happily ever after" and he did not need to pursue any legal action.
When asked about his once held position as the richest man in Ireland, the 12th richest in Ireland and the UK and among the 200 richest in the world, he said: "How times can change".
Mr Quinn said he was given assurances that Anglo Irish Bank was well capitalised.
He said he had meetings with the Financial Regulator amid concerns over Quinn Insurance.
He said the regulator was concerned about the insurance company and about his stake in Anglo.
He said he remembered meeting the Financial Regulator but did not recall saying at that meeting: "Seán Quinn needs to be reined in."
He accepted that he may occasionally speak about himself in the third person.
He did not remember apologising or why he would have said from now on whatever the regulator was told about Quinn Insurance would be 100% truth but said he was "not disputing" what was in the minutes of the meeting.
Mr Quinn was being questioned by Brenda Grehan, senior counsel representing Mr Whelan.
Mr Grehan put it to him that in handing over physical control of the shares he held in Anglo to the bank, the Quinns were "handing over the keys to the shop".
Mr Quinn replied: "David Drumm never got the keys to the shop. Those share pledges were never signed until after he left."

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