The jury at the trial of three former Anglo Irish Bank directors has been told the case is not about getting vengeance for the collapse of the banks in Ireland.
In his closing speech yesterday, Brendan Grehan SC, for Pat Whelan, said everyone had been affected by the collapse of the banking system but that the trial was about a distinct and separate matter.
He referred to wage cuts and the loss of increments and the things that “really get people angry”, such as cuts to special needs assistants for a child or home help for a parent.
Mr Grehan said someone told him the other day that a spectator had come into the court and, having watched the proceedings, said: “Give them a fair trial and then hang them.”
“You are not spectators, ladies and gentlemen,” he said. “It is vital that you divorce yourselves from that kind of thinking, that you are here to satisfy the baying for blood of the mob.”
Mr Grehan said this case was “not about the collapse of the banks in Ireland and seeing three men in the dock as a way of getting vengeance for it.”
Rather it was about a provision of company law that had been on the statute books since 1963 but had never been used.
There was justifiable anger on the street about the financial crisis, the collapse of the Celtic Tiger, the Government’s bank guarantee and the amount of money people lost. However, the jury must decide “devoid of pressure from outside this courtroom”.
Ordinary course of business
Mr Grehan told the jury that Mr Whelan had never resiled from his role in the July 2008 transaction to unwind businessman Seán Quinn's stake in Anglo.
He had acted in the belief that what he did was in accordance with the bank's ordinary course of business – a belief based on the fact that the Financial Regulator was comfortable with the deal, positive legal advice had been received and Morgan Stanley would not get involved unless it was satisfied that it met all legal and regulatory requirements.
Mr Grehan said his client did not have “the slightest inkling” that anything he might have been doing was wrong. With the “crystal clear prism of hindsight”, everyone could say that the share price collapsed afterwards and that the lending had been a bad idea. At the time, though, it was a “perfectly valid commercial transaction”.
Evidence from the Maple 10 borrowers showed that they also regarded the loans as being on commercial terms, with conditions similar to some of their loans with Anglo and other banks.
Mr Grehan said it was difficult now to put one’s mind back to that time before the “financial tsunami”, but at the time, banks were looked on as “blue chip” and a safe investment.
Worthless shares
"Nobody but nobody believed that the bank was going to fail and that the shares would become worthless."
According to the prosecution, Mr Grehan said, it did not matter what legal advice was obtained, what the Financial Regulator said or that a compliance department was set up to ensure one stayed within the law, nor did it matter that one of the biggest investment banks in the world was involved and that they went through their compliance procedures and consulted with all parties.
If a director could not rely on legal advice, the Financial Regulator or anyone above or below them, “how as a director do you comply?”
