FitzPatrick cleared on shares fraud

Former Anglo Irish Bank chairman Sean FitzPatrick has been found not guilty on six fraud charges over a multi-million loans-for-shares deal, a court has heard.

Sean FitzPatrick, former chairman of Anglo Irish Bank
Sean FitzPatrick, former chairman of Anglo Irish Bank

The one-time chief executive of the defunct bank is now on trial for 10 charges linked to a plan to lend money to trusted investors to buy stock in the bank.

The deal was part of a plan concocted in 2008 to prop up Anglo's share price amid reports that former billionaire Sean Quinn had built up a secret 28% stake in the bank.

Judge Martin Nolan told the jury at Dublin Circuit Criminal Court that he was directing verdicts of not guilty against FitzPatrick on six counts.

They relate to the lending of millions of euro to six members of the Quinn family to convert the hidden share derivatives Mr Quinn invested in to ordinary stock.

A second former executive, Anglo's former managing director of lending Pat Whelan, has been found not guilty on seven separate fraud charges, the court heard.

He had been accused of being privy to the fraudulent alteration of loan facility letters to seven individuals in October 2008.

"For good reason I have directed a not guilty verdict in these matters," Judge Nolan said.

The state's case against former Anglo executives Mr Whelan, former chief risk officer William McAteer and Mr FitzPatrick alleges they were involved in providing unlawful financial assistance to individuals in July 2008 to buy shares in the bank, contrary to Section 60 of the Companies Act.

The plan was designed to unwind the secret 28% stock position built up by Mr Quinn in a 2.4 billion euro (£1.98bn) investment in Contracts for Difference (CfD), a trading derivative allowing him to gamble on the share price rising without ever owning the shares in full.

The prosecution case finished last Friday.

The Anglo clients allegedly involved in the deal included six members of the Quinn family and a group of investors and developers trusted by the bank and known as the Maple 10.

Each of them borrowed 45 million euro (£37m) while the Quinns borrowed a total of 170 million euro (£140m).

FitzPatrick, of Whitshed Road, Greystones, Co Wicklow, McAteer, of Auburn Villas, Rathgar, south Dublin, and Whelan, of Coast Road, Malahide, Co Dublin, are on bail.

Whelan and McAteer are on trial for 16 counts of breaches of company law over the loans.

FitzPatrick is on trial for 10 counts relating to the loans to the Maple 10. They have all pleaded not guilty.

The trial is in its closing stages.