Bank thought fraud accused was 'a valuable connection', court hears
on 23/10/2013 17:07:45
The bank regarded Mr Byrne as a "highly regarded and experience broker with an excellent track record".
Documents presented to the court show that they saw the accused as a "valuable connection" who was responsible for introducing several high net worth individuals to Bank of Scotland Ireland (BOSI).
The jury also heard evidence that Mr Byrne was recruited by the bank to be on their legal panel and carry out work as a solicitor for them.
Mr Byrne (aged 47) of Walkinstown Road, Crumlin is accused of theft and fraud offences totalling €51.8m.
The charges allege he transferred clients' homes into his name and then used them as collateral for property loans.
He has pleaded not guilty at Dublin Circuit Criminal Court to 51 counts of theft, forgery, using forged documents and deception between 2004 and 2007.
The former head of credit risk with BOSI, Henry Roach, told the court that Mr Byrne was granted three loans by the bank for the purposes of property development and trading.
The first of these loans was for €4m secured against 16 properties. The witness said the bank was happy to grant this loan despite Mr Byrne being a first time customer.
Documents state that this was because Mr Byrne "was well known (to the bank) and is regarded as a valuable connection." The bank documents also note that Mr Byrne had a rental income of €498,000 a year and a director's income of €500,000 a year. It states his net worth was €6m.
The second loan was for €900,000 which the accused sought to buy to penthouse apartments in Skerries.
The final loan was for €8.7m. Mr Byrne applied for this in partnership with developers John Kelly and Mary O'Connor. Mr Roach told prosecuting counsel Remy Farrell SC that its purpose was to assist in the financing of the purchase of 10 neighbouring houses in Walkinstown.
It was intended that the site be used to build an apartment complex.
This loan was to be repaid over 24 months and all three partners were equally liable.
The court heard Mr Kelly was well-known to the bank as a property developer with €12m worth of holdings.
Ms O'Connor was described in documents as a radiologist who had been very successful on the property market and had a net worth of €5m.
Mr Roach said subsequent investigations showed that Mr Byrne was not the registered owner of several of the properties which were being used as collateral for the loans.
He said other properties were already promised to other banks as collateral.
Other terms used by the bank to describe Mr Byrne were "experienced" and "shrewd".
The jury were told he was a highly regarded member of BOSI's legal panel and had operated a successful practice for 20 years as of 2004.
Defence counsel Damien Colgan SC said there were several errors in the banks documents. He pointed out that Mr Byrne had only operated his own practice for 10 years at that point, not 20. He said Mr Byrne also denied ever being on BOSI's legal panel.
One of the BOSI documents from 2004 states Mr Byrne was responsible for introducing Mr Kelly and his business to the bank. Mr Colgan said it was in fact Mr Kelly who introduced Mr Byrne to BOSI.
Mr Colgan also drew attention to the signature of Tony Wynne on several of the documents associated with Mr Byrne's loans. Mr Roach confirmed that Mr Wynne was a lending manager with BOSI before resigning.
The witness agreed that allegations were made against Mr Wynne that he engaged in secret dealings with a customer and that the bank carried out an enquiry into this.
The trial continues before Judge Patrick McCartan and a jury of seven men and five women.