Former bank worker denies sanctioning loans to Michael Lynn for use on non-agreed purposes

Isabel Hayes

A former bank worker has told the multi-million euro theft trial of former solicitor Michael Lynn that his “job would have been on the line” if he had sanctioned a loan for a purpose other than that set out in the agreement.

Mr Lynn (55), of Millbrook Court, Redcross, Co Wicklow, is on trial accused of the theft of around €27 million from seven financial institutions. He has pleaded not guilty to 21 counts of theft in Dublin between October 23rd, 2006, and April 20th, 2007.

It is the prosecution’s case that Mr Lynn obtained multiple mortgages on the same properties, in a situation where banks were unaware that other institutions were also providing finance.

The financial institutions involved are Bank of Ireland, National Irish Bank (later known as Danske Bank), Irish Life and Permanent, Ulster Bank, ACC Bank, Bank of Scotland Ireland and Irish Nationwide Building Society (INBS).

On Tuesday, former Bank of Ireland worker Sean Dooley told Karl Finnegan SC, prosecuting, that he worked in the bank until September 2005.

He agreed that he sanctioned certain loans for Mr Lynn, including an apartment development at Carrick-on-Shannon in around 2003.

He said Mr Lynn had a wide investment portfolio and the Carrick-on-Shannon development required a “sizeable loan” of about €1.5 million.

He said at no time was he involved in arranging loans for Mr Lynn that were to be used for any purpose other than that set out in the agreement, such as property investments abroad.

My job would be on the line if I sanctioned a loan for one purpose and allowed it to be used for something else.

“There's absolutely no way,” he told the court. “My job would be on the line if I sanctioned a loan for one purpose and allowed it to be used for something else.”

He agreed with prosecution counsel that he left the bank in 2005, before the Bank of Ireland loan which the jury has to consider was taken out.

Under cross-examination from Paul Comiskey O'Keeffe BL, defending, Mr Dooley said he last met Mr Lynn in late 2004 or early 2005.

Asked if it was normal for a Dublin-based banker to arrange a loan in Leitrim, Mr Dooley said it was not unusual. He said if he had handed the loan over to the Leitrim branch, then he would have got the credits on his target.

“Everybody in the bank was target driven,” he said. “I had lending targets.”

He agreed that he attended a rugby match – maybe more than one – including attending the hospitality suite and said he could not remember if there were other tickets given to him by Mr Lynn. “That was kind of standard at the time, corporate entertaining,” he added.

Credit Committee

Gerry O'Gorman of Bank of Ireland also gave evidence on Tuesday.

John Berry BL, prosecuting, told the court that Mr O'Gorman was named by Mr Lynn in the last trial as someone who “agreed with Mr Lynn he could do whatever he wanted with the money given to him”.

Mr O'Gorman denied this was ever the case.

Mr O'Gorman was also named by Mr Lynn as being on Bank of Ireland's credit committee, the court heard.

Mr O'Gorman told the court he was working as an assistant to senior business manager Jim Madden in 2006 and 2007. He said he had no recollection of meeting Mr Lynn.

“There's a suggestion you were on the credit committee and you met with Mr Lynn in that capacity?” Mr Berry asked. “No,” the witness replied. He said he was “definitely not” on the credit committee.

Under questioning from Paul Comiskey O'Keeffe BL, defending, Mr O'Gorman said the credit committee was made up of “really senior bank officials”.

He agreed that the entity in Bank of Ireland that was involved in approving loans was called group credit and that he went on to work for group credit in 2008.

Mr Comiskey O'Keeffe put it to Mr O'Gorman that in the last trial he stated that he might have met Mr Lynn if he came into the branch and he didn't remember.

“I have no recollection of meeting Mr Lynn,” the witness replied. “In the circumstances set out in the statement sent to me, I never met him.”

The trial continues before Judge Martin Nolan and the jury.