Nick Leeson urges David Drumm to come home

The former Anglo chief executive, who fled Dublin after its collapse in 2008, is planning to appeal against a Boston court’s order not to write off €10m debts at the same time as he faces a possible extradition order from Irish authorities.

Leeson, who went on the run for all of three days as the venerable Barings institution went bust in February 1995, said the first instinct is like that of an animal – self-preservation – but Mr Drumm now has to think about the rest of his life.

“You can liken it to depression, to alcoholism, to any form of drug addiction - until you actually physically and mentally accept what you are doing you are not going to get better, you are not going to move forward,” he said.

“Drumm for me has this huge issue that he needs to deal with for his own well being and if he does not do that he’s just deluding himself.

“I’m sure it does not look particularly healthy when he’s thinking of coming back and what he’s going to face – the Anglo tapes won’t have done him any favours – it’s all out there, but for me he should get on the plane.”

David Drumm

Leeson this week reflected on 20 years since Barings went bust.

Britain’s oldest merchant bank had traded successfully since 1762, including financing the sale of Louisiana from France, until the rogue trader sent a fax on February 23 from his Singapore base announcing he was ill and was resigning.

His reckless trading floor gambles had sunk the old bank.

But any debt comparisons with Anglo pale into insignificance – Irish taxpayers were saddled with a €30bn debt pile for toxic lending, 30 times what Leeson lost.

The former trader, who now has a comfortable life in Galway and earns tens of thousands a year making after-dinner speeches and working as a debt management consultant, said he has learned from how he handled his own personal crisis, and Mr Drumm should too.

“Come back and get it over and done with,” he said. “Based on what’s happened with some of the other people, he might get away with it, who knows?

“You’ve got to go through it anyway. If you’ve done something wrong, if you’ve made mistakes, whether it’s stupidity or criminal, you’ve got to face it just because for you personally if you’re going to have a chance in life and you want to move forward you’ve got to accept that you’ve got to be responsible for your actions.

“I don’t think I necessarily went through that thought process at the time but it’s the only way to deal with it.”

'Hamlet without the prince'

Mr Drumm headed Anglo in 2008 as rumours circulated on international money markets that former billionaire Sean Quinn had secretly built a 10% stake in the bank. The share price was tanking at the time.

In July that year, months before the bank and its debt was nationalised, the chief executive offered 10 developer clients loans to buy shares in the bank and prop up its stock market value.

At a trial over the loans last year, a judge describe the former chief executive’s absence as “Hamlet without the prince”.

Leeson urged Mr Drumm to reverse that analogy.

“I get the self-preservation bit, you want to remove yourself from all the glare and where the heat of the furnace is going to be hottest,” the former trader said.

“From a personal perspective it can’t be doing him any good. It’s got to really be weighing him down."

Leeson dismissed suggestions that his attitude was disingenuous, now that he has happily remarried, flies out to speaking engagements no more than twice a month and has reinvented himself as a financial advisor after resigning as Galway United Football Club chief executive in 2011.

“I’m not going to give you a cock and bull type of answer. That’s what I would have done years ago when I was working in the bank. That’s how I survived - giving one person one answer and another person a different answer,” he said.

Leeson also offered his opinion on how Ireland was crippled by financial crisis in the banks.

“Stupidity. Stupidity among the politicians, the developers at the time and the bankers, combined together. It was a lack of adequate experience and they were just running away with themselves,” he said.

“In Ireland there wasn’t any transparency, people did not know what was being lent, there were no stress tests, fairly standard lending levels that have existed for hundreds of years were being breached ten fold 20 fold so it went against everything they had learned about traditional banking,” he said.

“The regulator was poor, government was poor, auditors – everybody who could have challenged was not really up to the mark.”