FORMER ANGLO IRISH Bank executive Willie McAteer will not serve any extra time in prison for receiving a fraudulent loan in September 2008 in order to keep the bank from failing.

Imposing a sentence of two and a half years, Judge Martin Nolan said survival was the main motivating factor in the fraud trade. McAteer, then director of finance at the bank, obtained the €8m loan as the bank was on the brink of collapse.

McAteer is already serving a three and a half year prison term imposed in July 2016 for his part in a separate €7.2 billion fraud. The latest sentence will run alongside this.

Last month McAteer (66) of Greenrath, Tipperary Town, Tipperary, pleaded guilty to obtaining a loan of €8million from Anglo on 29 September, 2008 which he secured against his shares in the bank. He then used the money to pay off a personal loan he obtained from Bank of Ireland.

The loan was formulated by Anglo’s executive board of directors to prevent the Anglo shares being sold off which would have further damaged confidence in the bank. The maximum penalty available for the offence of fraudulent trading was seven years in prison and a €63,486 fine.

Pressure

Imposing a sentence of two and a half years Judge Nolan said that at the time McAteer and executives in the bank were under considerable pressure and their whole ambition was survival.

He said there was a possibility that Bank of Ireland would sell off shares in the name of McAteer, as the shares were security against €8m personal loan to McAteer. He said the bank did not want this to happen and “a plan was hatched to deal with this situation”.

“The whole ambition was survival. Survival is not a reason to commit crime. But it was a substantial motivating factor.” he said.

He said that McAteer was a self made man who came from a modest background and studied hard and worked very hard. He said he was at one point an extremely wealthy and successful man.

Judge Nolan said McAteer will be an impoverished man when he gets out of prison and will live in modest circumstances. He said it is highly unlikely he will re-offend.

Age

Taking his age and personal circumstances into consideration he said it would be unjust to impose a sentence consecutive to the one he is already serving. He ordered the sentence to start from today.

Last Monday Garda Glen MacKessy of the Office of the Director of Corporate Enforcement said that prior to September 2008 McAteer, like most Anglo executive directors, had built up a substantial shareholding in the bank.

He said the directors in Anglo were encouraged to buy and hold large amounts of newly issued shares in the bank. McAteer used five loans from Bank of Ireland to purchase a total of 3.3 million shares. These were recourse loans meaning McAteer was personally liable if he defaulted.

The court heard Bank of Ireland had a provision where if the share price fell below a certain ratio in relation to the loan it could sell off the shares without consulting McAteer. The sale of these shares would occur under McAteer’s name and would have to be disclosed to the market and the financial regulator.

Garda MacKessy said in 2008 Anglo’s share price began to fall drastically and Bank of Ireland could have sold McAteer’s shares if it wished. McAteer became aware of this and informed the senior management at Anglo.

Anglo’s board of directors were concerned that a sudden sell off of a director’s loans could have a disastrous affect on the overall share price. A plan was formulated to refinance McAteer’s shares using a €8,246,307 loan from Anglo.

This loan would be secured against the shares only and McAteer would not be personally liable.

The court heard Bank of Ireland had made no move to sell off the shares and had given no indication that it might.