Investigator accepts aspects of Sean FitzPatrick investigation 'colossally prejudiced'
The lead investigator into allegations of financial crimes by former Anglo Irish Bank chairman Sean FitzPatrick has accepted that aspects of his investigation were “colossally prejudiced”.
Counsel for Mr FitzPatrick (aged 68) described as “an outrage” a decision by Kevin O'Connell, an investigator with the Office of the Director of Corporate Enforcement (ODCE), not to ask witnesses certain questions because they might “undermine” his case.
Mr FitzPatrick is accused of failing to disclose multi-million euro loans to auditors. The prosecution alleges that the amount of the loans was “artificially reduced” for a period of two weeks around the bank's financial end of year statement by short term loans from other sources, including Irish Nationwide Building Society.
On day 70 of the trial at Dublin Circuit Criminal Court, Bernard Condon SC, defending, continued his cross-examination of Mr O'Connell, a legal advisor with the ODCE who dealt with witnesses from EY (the Ernst & Young), Anglo's auditors from 2002 to 2008.
He put it to Mr O'Connell that in April 2010 he had gone into his first meeting with key witnesses from EY with an acceptance that they had not known about the movement of loans to Irish Nationwide.
Mr O'Connell replied: “I see it suggests a degree of prejudgement” but added that there was nothing in the evidence he had so far received that the loans had been disclosed to the auditors.
Mr Condon said that if the loans had been made known to EY “we wouldn't be here” in court.
“That is an absolutely colossal piece of prejudice. That was wrong to do,” he said. Mr O'Connell said he agreed adding: “It was a very inexperienced way of approaching the matter”.
Counsel described as “an outrage” the failure of investigators to ask witnesses about auditing standards which suggested auditors remind directors that it was a criminal offence to mislead auditors.
“You were charged with carrying out a fair and impartial investigation,” counsel said, accusing Mr O'Connell of deliberately deciding not to ask about these standards.
Mr O'Connell agreed it was “a very serious mistake” adding: “I very much regret that this was not something that was addressed within the full engagement with EY. I don't in any way seek to stand over that decision.”
“We were seeking to build the case. We did not at this early stage want to start setting out the weaknesses in the case.”
Mr Condon suggested asking certain questions “would hurt your case”.
“If they were to say something about this, it would undermine your ability to bring a prosecution at all. I think that is so,” counsel said.
Mr FitzPatrick of Whitshed Road, Greystones, Co Wicklow has pleaded not guilty to 27 offences under the 1990 Companies Act.
These include 22 charges of making a misleading, false or deceptive statement to auditors and five charges of furnishing false information in the years 2002 to 2007.
The trial continues before Judge John Aylmer on Monday.
