22 people involved in drafting unlawful witness statements
TRIAL OF SEAN FITZPATRICK CONTINUES
TUESDAY
Investigators into alleged crimes by former Anglo Irish Bank chairman Sean Fitzpatrick used ‘unlawful’ practices when taking witness statements, his trial heard.
Lawyers for Mr FitzPatrick (68), who is accused of misleading auditors about multi-million euro loans, have said that statements from witnesses from the auditors were produced as a result of coaching and cross-contamination between witnesses.
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.
On day 72 of the trial in Dublin Circuit Criminal Court, the jury saw a draft statement from Vincent Bergin, the audit manager for Anglo, with numerous changes, including insertions and deletions of entire paragraphs, suggested by investigators.
The evidence emerged during the fourth day of defence cross-examination of Kevin O’Connell, a legal advisor with the Office of Director of Corporate Enforcement (ODCE), who dealt with witnesses from EY (formerly Ernst & Young), Anglo’s auditors from 2002 to 2008
The document titled ‘ draft statement by Vincent Bergin’ and dated November 1, 2010, was circulated to a number of people in the ODCE, including Mr O’Connell and his then boss, Paul Appleby, the director of corporate enforcement.
These people suggested changes to the document and Mr O’Connell said he then distilled or synthesised ‘ the shared viewpoint’ that was finally settled on.
The jury was shown various versions of the document with new sections inserted, other sections crossed out or deleted, and others marked with the words ‘drop’ or ‘delete’.
Bernard Condon SC, defending, compared the process of producing the statement to the ‘ hokey cokey’.
‘It goes in and it goes out. The statement is just shaken out. A meeting of bits going in and bits going out,’ he said.
Mr O’Connell agreed the process was wrong and inappropriate. Mr Condon told the court that rulings by Judge Mary Ellen Ring during the first trial in May 2015 and by Judge John Aylmer during the current trial found that it was an unlawful practice.
He said it was unlawful because it meant the jury never get to hear what the witness might have said in an unvarnished statement and not produced after they had being coached.
Mr O’Connell said he couldn’t quibble with counsel’s characterisation of one particular ODCE insertion as ‘outrageous’ .
The paragraph states: ‘I regard the letter of representation in any audit as a statement made to us...which conveys information...which we require under the Companies Act’. Counsel said the exact wording ended up in the final statements of EY auditors Mr Bergin and Kieran Kelly.
‘It comes out of the mouth of the ODCE and is put into the mouth of Vincent Bergin. It is wrong, wrong, wrong,’ he said’
‘It’s the poisoning of the pool. It moved from ODCE to Vincent Bergin and it gets into Kieran Kelly’s statement.’
Both Mr Bergin and Mr Kelly are due to give evidence later in the trial.
Mr O’Connell said he accepted now that the process was wrong but said it was his honestly-held belief at the time that the final statements represented the considered view of both witnesses.
The jury saw one typed comment, attributed to Mr Appleby, on a version of the statement and stating: ‘Is Mr Bergin’s answer not likely to be very unfavourable. Accordingly are we wise to suggest this?’
Counsel submitted that this comment was contrary to the duty of an investigator to seek out evidence as to the innocence as well as guilt of suspects. Mr O’Connell agreed that it was a wrong thing to say and he regretted that he did not know this at the time and did not object to it when it was said.
Another comment attributed to Mr Appleby states: ‘I don’t think we should suggest an answer. Mr Bergin may wish to withdraw the statement or revise it, which would suit us better’.
Mr Condon said this comment was not indicative of an impartial investigation. ‘It’s quite wrong for Mr Appleby to take this out because you might get a better answer,’ counsel submitted. Mr O’Connell agreed.
‘ There are serious dangers in telling people what to say and in writing it for them. This is a person’s statement, presented to the defence as the statement of Vincent Bergin. This is a statement, the wording of which is a product of you and Paul Appleby and others in the ODCE and unknown people in the EY and A&L Goodbody (lawyers for EY),’ Mr Condon said.
WEDNESDAY
Gardai were not involved in the drafting of witness statements criticised by a trial judge in the prosecution of former Anglo Irish Bank chairman Sean FitzPatrick, a court has heard. Lawyers for Mr FitzPatrick (68), who is accused of misleading auditors about multi-million euro loans, have previously said that statements from witnesses from the auditors were produced as a result of coaching and cross-contamination between witnesses. Earlier last week the jury heard that the practices used by investigators from the Office of Director of Corporate Enforcement (ODCE) were found to be ‘unlawful’ by Judge Mary Ellen Ring during the first trial in May 2015. On day 73 of the trial in Dublin Circuit Criminal Court, the jury was shown a letter written by Detective Superintendent Gerard Walsh in June 2015 relating to the adjournment of that trial. In the email, which accompanies a report made by Detective Inspector Raymond Kavanagh, Superintendent Walsh states that ‘ the garda unit seconded to the ODCE were not involved in drafting of the witness statements the subject of courts criticism’.
The email requested that the attached report be forwarded to garda management. Kevin O’Connell, a lead investigator who had admitted his involvement in wrong and inappropriate practices, told the jury that Dt Inspector Kavanagh was present during a meeting in December 2010 where drafting of statements had taken place.
At this time DI Kavanagh had just recently taken on the seconded role with the ODCE, he said.
Mr O’Connell has also previously admitted shredding documents which were relevant to the investigation. On Wednesday he told the jury that he discovered the documents on a Friday evening after he had spent four days under cross-examination over the drafting of the statements during the first trial.
Earlier that same day he had discovered 16 pages relevant to the investigation. He brought these to the attention of the director of corporate enforcement Ian Drennan and the documents were scanned and emailed to the DPP.
Henry Matthews, an officer with the DPP, then told Mr O’Connell that the late discovery of relevant documents was unfortunate and most unhelpful and that he would have to go back into the witness box to account for it.
He told Mr Condon that he was terrified about the prospect of having to get back into the witness box and undergo further cross-examination. He said the elation he had felt after finishing his evidence turned to panic.
A short time late he discovered four more documents related to EY (formerly Ernst & Young), Anglo’s auditors from 2002 to 2008. He said his panic grew and he decided to shred the documents.
‘It was a completely wrong thing to do. I’m ashamed of it. I have never done anything like it before nor I hope will I ever again.
‘It was a time of very considerable pressure. I made a desperate, desperate mistake. I was aware of what they were, that further heightened the panic I was in.
‘It was a time of enormous strain, more so than I’d ever experienced in my professional career before,’ Mr O’Connell said. He said that over the weekend he despaired and agonised over his actions and realised he could not maintain the lie.
He said without prompting from anyone else he rang his boss Ian Drennan and told him what had happened.
‘All I can be grateful for is, 48 hours later, I did the right thing in admitting the wrong thing that I had done. I’m glad I did,’ he said.
The jury was shown CCTV footage from the ODCE offices showing Mr O’Connell bringing a tray of documents from his office to a shredding room. A colleague, Garda Gary Callinan, approached Mr O’Connell at this time and Mr O’Connell can be seen attempting to conceal the documents while the two men talk.
Mr Condon pointed out that around half an hour earlier Garda Callinan had been in Mr O’Connell’s office ‘shooting the breeze’ and having a social conversation. Mr O’Connell agreed that he had the documents at this point and did not disclose it to his ‘ trusted colleague’.
He said that ‘ the train had already left the station’ and his mind was made up to destroy the documents. ‘Another grave error on my part. I regret I didn’t tell him,’ Mr O’Connell said.
Garda Callinan previously testified that it was a normal conversation and he didn’t notice anything unusual about Mr O’Connell, the court heard.
Mr O’Connell told the court that his decision to destroy the documents was unethical.
Mr Condon described it ‘an absolute disgrace’, saying: ‘it was without doubt a truly appalling thing for a State investigator, given the powers available to you’.
In other evidence the jury heard that a statement given by a witness for the prosecution was changed during a meeting the witness wasn’t present for.
The jury were shown more drafts of what would eventually become the witness statement of Vincent Bergin, the audit manager for Anglo.
The change was detailed in an ODCE internal email dated December 5, 2010, weeks after the ODCE had received a first draft of the statement from EY’s lawyers, A&L Goodbody.
In the subsequent weeks the ODCE produced their own version of the
statement which included suggestions for additional paragraphs and for deleting sections.
Mr O’Connell noted that the lawyers have taken on board most of the suggested changes. He said that ‘most crucially’ they changed what he said was a ‘rather weak statement’ to one which includes the words: ‘from my perspective as the auditor receiving the letters... I believe the letters were misleading, false or deceptive in a material particular’.
Mr Condon said it was a piece of brazenness for Mr O’Connell to presenting this change as theirs when he was in the room when it was agreed at a meeting with EY’s lawyers.
He said that the ‘I’ in the statement, Mr Bergin, wasn’t in the room.
‘His solicitor was typing out the wording which would be agreed with the ODCE,’ counsel said.
Mr O’Connell replied that he believed that the wording would ultimately only appear in the final statement of Mr Bergin if Mr Bergin was willing to adopt the wording.
‘If he had any issues to that wording he would not have signed up to it,’ he said.
In an email sent in November to Mr O’Connell and referring to the ‘ tidying up’ of the statement, Liam Kennedy, partner with A&L Goodbody, states: ‘My client may simultaneously be doing some polishing’.
THURSDAY
Gardaí have never investigated a State official’s destruction of documents related to the investigation of alleged crimes by former Anglo Irish Bank chairman Sean Fitzpatrick, the trial heard.
The jury had already heard that in May 2015 Kevin O’Connell, a lead investigator from the Office of Director of Corporate Enforcement (ODCE), shredded documents which were relevant to the investigation.
He told Bernard Condon SC, defending, that he panicked when he discovered the five pages in his office and made a wrong decision to destroy them. He admitted it was unethical and said he was ashamed of his actions.
He said he disclosed his actions to his boss, director of corporate enforcement Ian Drennan, three days later.
On Thursday morning Mr Condon began a sixth day of cross-examining Mr O’Connell. The witness agreed that it was a criminal offence to destroy documents relevant to an investigation.
He also agreed that there had been no garda investigation into his shredding of the documents.
He said when he told Mr Drennan about his actions he did so knowing it could have led to very serious outcomes such as criminal investigations or disciplinary proceedings. He agreed with counsel that none of these things happened.
Mr Condon said there had been no garda investigation and hence there had been no prosecution.
He said that at the start of the current trial last October the Director of Public Prosecutions (DPP) offered Mr O’Connell what counsel described as ‘effective immunity’ from prosecution.
This offer came while Mr O’Connell was giving evidence during legal argument and he indicated to the court that he may wish to rely on the privilege against self incrimination.
Mr Condon told the jury that this was a legal right available here and known in the United States ‘as pleading the fifth’, where a person does not have to answer a question that may incriminate them.
On October 12 last, 2016 the Chief Prosecution Solicitor for the DPP wrote to solicitors for Mr O’Connell stating that no evidence given by him concerning the destruction of documents would be used in evidence in any criminal proceedings against him.
The court heard that lawyers for the DPP have firmly rejected that the letter amounted to an immunity against prosecution. Mr Condon submitted that it was a qualified but ‘effective’ immunity.
Mr Condon moved on to ask Mr O’Connell about the process of agreeing the statement of Kieran Kelly, the second witness from Anglo’s auditors EY (formerly Ernst & Young).
The defence have told the trial that statements from witnesses from the auditors were produced as a result of coaching and cross-contamination between witnesses and that Judge Aylmer previously ruled that this was an unlawful process.
The process of drafting Mr Kelly’s statement began in early 2011 with Liam Kennedy, a partner with A&L Goodbody (ALG), who represented EY, sending a first draft of Mr Kelly’s statement to the ODCE.
The jury saw notes made over the following months. One note shows Mr Kennedy discussing the grafting of paragraphs and ‘cut and paste’.
In June 2011 Mr O’Connell discussed meeting with the lawyer in the absence of Mr Kelly. He proposed this in an email sent to gardai seconded to the ODCE and to the then director, Paul Appleby.
In the email he said the lawyers were the people who we had to convince about how best to move forward.
‘Even if Mr Kelly was in attendance it’s likely to be the lawyers who would take the lead role in discussing the next steps,’ he continued.
Mr Condon said that in the meeting that followed, there were four lawyers, two gardai and no witness present.
The jury heard that the process of putting the statement together continued throughout the summer of 2011. In November 2011 Mr O’Connell said that ‘ the statement was largely based on Vincent Bergin’s statement, which they had been happy with’.
Mr Bergin is the other prosecution witness from EY and his statement was also produced as a result of the unlawful drafting practice.
A draft of Mr Kelly’s statement provided from ALG to the ODCE in November 2011 contained multiple paragraphs labelled with a margin note ‘verbatim from VB statement’.
The jury saw notes of advice given by Mr Kennedy to Mr Kelly in advance of a meeting with Mr O’Connell. Mr Kennedy is recorded as telling Mr Kelly that he may be asked to look at documents by the ODCE investigator.
He advised Mr Kelly: ‘ Be seen to look at a few. Say you have to think on it and reflect on it’. A later note states that Mr Kennedy told Mr Kelly ‘ the less you say the better’.
Mr Condon submitted that the legal advice amounted to telling Mr Kelly to ‘engage in a sort of pantomime performance’ with the ODCE investigator.
He told Mr O’Connell: ‘Kieran Kelly was to have a meeting with you. He was to pick up as much as he could from you, commit to nothing, meet with his solicitor, then decide. This was going to be a piece of theatre.’
He said that in the subsequent meeting between Mr O’Connell, Mr Kelly and Mr Kennedy, Mr Kelly said very little and ‘sat there like a statue and didn’t open his mouth’.
Mr O’Connell agreed that the notes of the meeting attributed very little to the auditor. Most of the notes show the investigator and the lawyer discussing the statement.
Mr Condon suggested to Mr O’Connell that he had become too close to the solicitors for EY. Mr O’Connell said there was a degree of role playing where the two parties would be cordial with each other despite earlier ‘ups and downs’.
Counsel said that Mr Kennedy had taken on a role of intermediary between a State investigator and his own client. He said in one interaction in early 2011 the two of them agreed on what Mr Kennedy would say to Mr Kelly.
He said this was redolent of an investigator who was too close to solicitors for a witness.
‘It begs the question as to whether he should have ever signed up to such a thing. His duty was to his client,’ he said.
Mr Condon noted that in October that year an initial report from the accounting regulatory body CARB included a number of negative findings against EY. An appendix attached to the report included a 153 page defence by EY concerning its audit.
FRIDAY
Lawyers defending Sean FitzPatrick accused investigators of crafting and creating statements in order to get evidence to prosecute the former Anglo Irish Bank chairman.
On day 75 of the trial at Dublin Circuit Criminal Court, Bernard Condon SC, defending, finished his lengthy cross-examination of Kevin O’Connell, a lead investigator from the Office of the Director of Corporate Enforcement (ODCE).
During seven days in the witness box, Mr O’Connell admitted that the methods used to produce statements from witnesses in the investigation were wrong and unlawful.
He told Mr Condon that the mistakes he made were down to his inexperience of investigating criminal offences and denied they were part of a deliberate effort to get a prosecution at all costs.
On Friday, Mr Condon put it to him that the investigation was ‘a shambles’ and one which ‘you should not take any pride in and one which the ODCE should never repeat’.
Mr O’Connell replied that he took no pride whatsoever in all the manifold mistakes made by him. He said that since these mistakes were deemed unlawful by Judge Mary Ellen Ring during the first trial in May 2015, the ODCE has modified its practices.
The jury heard that in February 2012, Mr O’Connell’s then boss, previous director of corporate enforcement, Paul Appleby, wrote to an ODCE colleague thanking her for her work. He said: ‘Let’s hope we get prosecutable offences out of all your work’.
Mr Condon said this comment by Mr Appleby spoke volumes about a desire of the ODCE to prosecute Mr FitzPatrick.
‘Nothing was going to stop you,’ counsel said. The witness replied that they would have been stopped if relevant evidence had not been available.
‘So what you did was crafted and created witness statements so you could get evidence,’ Mr Condon said. Mr O’Connell repeated that his inexperience and a lack of input from other colleagues led to mistakes being made.
Mr Condon said the statements of witnesses from Anglo’s auditors EY (formerly Ernst & Young) were a result of coaching and contamination. He said they were statements by a committee formed by a triangle of three separate bodies, the ODCE, EY and A&L Goodbody, a legal firm representing EY.
He named 22 people. These included five gardaí, four people and ‘other unknown persons’ from EY and Liam Kennedy, a partner with A&L Goodbody.
Mr O’Connell agreed that these people were involved ‘to one degree or another’ in the drafting of statements using methods later ruled to be unlawful.
Earlier this week the jury saw a note to garda management stating that no gardaí were involved in the drafting of the statements.
The jury also heard previously that during the first trial in May 2015, Mr O’Connell shredded documents relevant to the investigation. On Friday he told Dominic McGinn SC, prosecuting, that the five pages destroyed would have been jottings and scribbled notes of phone calls.
He said that the investigation into Anglo had created thousands of paper documents, as well as 850,000 electronic documents. He said not all of these would be relevant to the audit fraud offences before the court.
The trial continues before Judge John Aylmer on Thursday.