THE Quinn family have rejected claims by the Irish Bank Resolution Corporation (IBRC) that loans they claim were given to them to 'prop up the share price' of the former Anglo Irish Bank were only disputed AFTER the appointment of a Share Receiver into their company.
A letter from the Quinn's solicitors, Eversheds, to Anglo's solicitors, McCann Fitzgerald, which has been viewed by this newspaper, has emerged and appears to question that theory.
Dated March 7 2011, the letter, sent over a month before the appointment of the Share Receiver to the Quinn Group, states that �2.344 billion was advanced by Anglo "to support a CFD (contract for difference) position in respect of Anglo shares held by our clients", and that Anglo "continued to advance those funds throughout the period from September 2007 until July 2008, a period during which they knew, or ought to have known, of the fundamental inaccuracy of the information upon which our clients were relying".
The letter goes on to state that, whilst reserving their legal position in relation to the monies advanced for CFDs, the family would repay all of the money if they retained economic control over Quinn Insurance.
In the letter, the family's legal representatives claim the reasons for the illegality of the loans and guarantees, and the unenforceability of them are as follows: the underlying purpose of the loans was tainted with illegality, the loans constituted or evidenced market manipulation within the meaning of the Market Abuse Regulations, they were in breach of Section 60 of the Companies Acts, 1963, the guarantees signed by the Quinn family were improvident, since they were signed without any independent legal or financial advice having been recommended, taken or provided, they were legally an unconscionable bargain, as they were signed at a time that the Anglo share price was under severe pressure, and that Anglo took no steps to protect the interests of the Quinn family, and by its own hand tainted the validity of the guarantees.
Attached to the letter is a Schedule of Valid Property Loans, also seen by this newspaper, from Anglo Irish Bank Corporation Limited, which lists ten companies, with the total loan amount for all companies totalling �455,109,784.
In a statement issued to this newspaper, the Quinn family said: "The existence of this document at least clarifies that the amounts argued now in various Court proceedings were in fact disputed before the decision to appoint the Share Receiver was made known. However, it also raises a number of interesting questions for the Irish Government, given that Anglo Irish Bank is a nationalised institution, which the Government are ultimately responsible for: Was the government aware that this letter existed and that the loans were disputed before sanctioning the appointment of a Receiver over Quinn Group? Was it aware that supporting your own share price is illegal, and that Anglo had allegedly been contriving to do exactly that before authorising the appointment of a Receiver over Quinn Group?"