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Anglo Tapes: Drumm admits €6 billion was being sent "around in a circle"

Former Anglo CEO David Drumm can be heard admitting he knew the lender was circulating the money between it and Irish Life & Permanent.

Image: Photocall Ireland

A NEW TAPED recording of former Anglo Irish Bank executives has been published this morning by the Sunday Independent.

The conversation between former CEO David Drumm and head of capital markets John Bowe shows that bank bosses were aware that €6 billion was being sent “around in a circle” between Anglo and Irish Life and Permanent.

The conversation took place in the days leading up to Anglo’s financial reporting date of 30 September 2008, when the bank would have been due to reveal the depth of its financial weakness.

THE LATEST RECORDING

Drumm: The Permo [Irish Life & Permanent] that six billion fix — are they still doing that?

Bowe: We’ve started it. We’re doing, like, bits every day.

Drumm: Oh, so we’re putting it back with them?

Bowe: Yeah, so what happens is the money goes around in a circle.

Drumm: So we don’t have the cash to give to them tomorrow?

Bowe: Em, unless we use part of the cash we have tomorrow to do part of that as well.

Drumm: It’s become a kind of academic exercise but…

Bowe: Yeah. What is happening is that we give the money to them. Look, the dance here is that we actually get it back in time.

That is becoming very, very tough to do.

So, in other words, we have to pay it into the bank. The bank has to give it in to the assurance company. The assurance company has to give it to us.

Drumm: Yeah, I know how it works.

Bowe: It has to go through a lot of hands in terms of the assurance company’s payment agent as opposed to the bank. So, just, it is actually very tough to do, but we are picking away at it

Drumm: A f*cking journal entry would be a lot quicker.

Bowe: I know, I know, I know.

Drumm: Remember this John — debit the giver, credit the receiver!

Bowe: (Laughes)

Drumm: Good luck!

The new public revelations are detailed in the Independent today under the headline “Honohan must deal with €6 billion Anglo ploy”.

It follows the Central Bank Governor’s statement this week clarifying his position on the initial Anglo recordings published by the paper earlier this year, which showed the lender attempting to mislead the Central Bank in the days before the bank guarantee.

An initial statement last Tuesday said that no further reports would be made to the authorities as no new issues had come to light “that relate to suspected criminal offences having occurred”

But on Thursday, Patrick Honohon said the Bank would “examine further the issue of releasing to An Garda Síochána information relating to the Bank’s examination of the Anglo Tapes transcripts”. The statement continued:

…I intend to share with An Garda Síochána, on a without prejudice basis, the Central Bank’s analysis of the issues arising in the tapes which led the Central Bank to conclude that no new issues have been identified that relate to suspected criminal offences having occurred.

The investigation into the toxic bank being carried out by the Garda Bureau of Fraud Investigation and the Office of the Director of Corporate Enforcement (ODCE) was launched in 2009 and is ongoing.

Rewind: A look at what the Anglo Tapes have meant for Ireland >

In depth: 30 days in September — an oral history of the bank guarantee >

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