Watchdog’s ‘nod and wink’ to bank boss

THE former chief executive of Irish Life & Permanent (ILP) has claimed the Financial Regulator encouraged him with a ‘nod and a wink’ to commit a multi-billion euro conspiracy.

Denis Casey made the claim in his Supreme Court appeal against his conviction for his part in a €7.2billion scheme involving back-to-back transactions, intended to make the struggling Anglo Irish Bank’s finances appear stronger than they were.

He claims he should have been allowed to use the role of the Regulator, Central Bank and the Department of Finance as a defence in his trial. His counsel, Michael O’Higgins SC argued that the Regulator had known about the transactions shortly after they were carried out in September 2008, and did not intervene before they were revealed in Anglo’s end-of-year financial statement in December that year.

But Judge Iseult O’Malley yesterday noted that while the Regulator Patrick Neary may have asked banks to support each other, he did not ask the banks to do this by doing something illegal.

At his trial in 2016, Mr Casey was sentenced to two years and nine months in jail. Mr O’Higgins said that for the defence to succeed, Mr Casey must show that the State induced him to carry out the transaction, and that he believed the transaction to be lawful for this reason. Paul O’Higgins SC, for the DPP said there was no evidence that the Regulator or the Central Bank knew of, encouraged or approved the transactions. The DPP argues the defence of officially induced error was not open to Mr Casey based upon the evidence.

In addition to the appeal, the court is considering if such a defence is available under Irish law. The appeal continues.