It was a deal that brought Davy, Ireland’s biggest and most powerful stockbroker, to its knees, tarnishing both its reputation and its relationship with key clients. 

The deal took place in late 2014, but it would take the Central Bank years to unravel its structure and to announce its censure. And when the regulator finally reported in March this year, it triggered a chain of rapid-fire events that would force Davy to put itself on the market. 

Fining it a record €4.13 million, the Central Bank described Davy as acting “recklessly” as it “prioritised” a group of 16 of its staff making a “personal financial gain over ensuring that it was complying with its regulatory obligations”.

Tánaiste Leo Varadkar described what had occurred succinctly: “It’s as though you were selling your house, the auctioneer pretended to be trying to get the best price for you but was actually the buyer himself.”

The scandal, and the insincere, indifferent way the broker initially responded to it, led to the resignations of Davy’s powerful chief executive Brian McKiernan and head of its bond desk Barry Nangle. Its deputy chairman Kyran McLaughlin, for decades a driving force in the firm, too announced his retirement.

Davy shut its bond desk which had carried out the deal, a desk that had represented Ireland for years on the international markets. The NTMA pulled its business. Other blue-chip corporates openly revealed they were reviewing their relationship with the broker.

Within days, the board of Davy announced the business, founded in 1926 and at the core of the Irish establishment, was being put for sale.

But just how much do we know about the 2014 Anglo bond deal that toppled the Davy hierarchy? For the past four months, The Currency has been investigating the transaction, examining who said what and who knew what. 

Based on multiple sources, documents, courtroom filings and new information, this is the inside story of the Anglo bond scandal.

*****

On Thursday November 13, 2014, Patrick Kearney received a message that caused him to stop and think. He was just about to sell his bonds in Anglo Irish Bank, the failed Irish lender. The bonds had a face value of €27 million and the message was from his advisor Tom Browne. Davy the Irish stockbroker had been in touch and Browne briefed Kearney that he would receive 20.25 cent in the euro for the bond. Kearney was disappointed as he had been under the impression the bond might have fetched more. By then Kearney was a long way down the road of selling his bond. Indeed, he had already opened a Davy client account to do the deal, and the paperwork was ready to sign.

Nine days earlier, Kearney’s company Kilmona had formally instructed Davy, in writing, to sell the bonds at a price of 15 cent in the euro “or better”. This was the minimum price he needed in order to clear a charge on his bond – a charge which related to a loan he had taken out from Anglo to buy the bond.

There was a fee due to Davy of €207,000 too, so the price he was actually getting fell to 19.5 cent. It would later emerge that this fee, which Davy asked for prior to the deal, was never pursued. But Kearney didn’t know that yet.

Belfast-born Kearney had left school early during the Troubles to make his way in business. He had an instinct for when things did not feel quite right that had guided him during the decades when Belfast was at times a warzone. He started to think of reasons why the price of his bond might have fallen. There had been nothing obvious in the news, but then again, he was not an expert in the bond market. That is why he had retained Davy. It was a niggle more than anything else.

The following morning, Friday, November 14, 2014, Kearney, as he made his way to Dublin, decided to ring a broker he knew in Cantor Fitzgerald, a rival brokerage. He wasn’t very suspicious, but he felt there was no harm in getting a second opinion. Kearney told a broker in Cantor Fitzgerald about his Anglo bond and the price he was being offered for it, asking him to get a price for it. The broker said he knew there were big funds trying to buy these bonds in the market, but he’d need to know more to get a price.

Kearney agreed to meet the broker for breakfast in Dublin 4. He told him about his Anglo bond and had all the paperwork to back it up. Kearney told the broker to ring him back when he had a price and carried on to the meeting he had come to Dublin for. His destination was a boutique corporate advisor called LeBruin Private in Marine House near the Grand Canal in Dublin 2.

There he was greeted by his friend Tom Browne, the co-founder of LeBruin. Kearney knew Browne for decades from his time as a senior banker with Anglo Irish Bank. There was another man there too, someone Kearney had met for the first time on October 1 (Browne was at that meeting also).

He was Tony O’Connor, a veteran bond trader with Davy. It was coming up to noon that day, and three men greeted each other cordially. O’Connor and Browne were not just helping him sell his bond, but they were also his business partners. Based on a 19.5 cent price, O’Connor stood to make a €750,000 personal fee for closing the deal, while Browne’s company LeBruin planned to charge Kearney €900,000. Kearney would get over €1 million from his cut of the profits.

Or at least that was the plan, before the partners fell spectacularly out.

“The market for these bonds is at best thin”

Patrick Kearney is a former joiner from west Belfast who, over a number of decades, steadily built up a portfolio of more than 100 multipurpose properties. Most were in his native Northern Ireland. He took over his family business in 1962 at the age of 17 when his father retired early due to ill-health brought on by the stresses of the Troubles. Kearney made his money hanging doors and fixing up buildings; sometimes after they had been damaged by the bombings and riots that ravaged Belfast during those years. He saved his money and used it to buy a modest office. He didn’t go to a private school or have the benefit of university education, but he was hard working and tended to do deals on a handshake.

The story goes that he was Anglo Irish Bank’s first customer in the North. True or not, he was certainly one of its biggest customers there from the late 1990s on. As a result, he was friendly with many of its senior executives in Dublin, including Tom Browne.

The website for Kearney’s property group Kilmona details the range of the assets he built up. He owns three hotels including the Ten Square Hotel in Belfast and he owns a number of holiday villas called Sotogrande near Cadiz in Andalucia in Spain. He has built various residential housing projects over the years and owns a number of office blocks and business parks. One of them called 9 Lanyon Place has 150,000 sq ft of ‘Grade A’ office space with tenants including the Northern Ireland civil service. His group employs about 300 people.

After the 2008 crash Kearney, along with hundreds of other developers, had his loans transferred to the National Asset Management Agency (Nama), a vehicle set up by the state to take commercial real estate loans from the floundering Irish banks.

Nama threatened to appoint administrators to Kearney’s business to try and force him to start selling all his assets. Like most developers, Kearney felt they’d come right in time, so he resisted.

Reflecting back on his Nama-ed years, Kearney told a November 2015 committee hearing in Northern Ireland that: “For me, it was a life-or-death situation: I was effectively fighting for my family’s and employees’ welfare and future.” Attending the committee hearing with him was his advisor Alan Mains, who he described as a “long-standing family friend and associate.” Mains is a formidable character who as a former head of the Economic Crime Bureau with the PSNI has investigated some of Northern Ireland’s most dangerous criminals including Thomas ‘Slab’ Murphy. Mains was not involved in the events of November 14, 2014, but he becomes important in its aftermath.

Kearney told the 2015 committee hearing that he asked the then First Minister Peter Robinson to assist him, and Robinson wrote a letter to Nama asking the agency to meet him. Kearney was far from the only developer in the North unhappy with Nama. Robinson and other politicians began to put pressure on Nama because they saw it as suppressing economic activity in the North. “Holding on to assets to realise their value in the long term does little to boost our economy right now,” Robinson said publicly at a DUP meeting in September 2013.

Nama has sweeping powers in the Republic to call in loans, but it became concerned that if it went to enforce in the North, it might be blocked in the courts, or stalled politically. In September 2013 Pimco, a $2 trillion dollar asset manager, approached Nama offering to take its entire Northern book off its hands. In the months after that approach, Nama decided to run a process – codenamed Project Eagle – to sell the portfolio. It resulted in the sale of its entire Northern book for €1.4 billion to Cerberus in April 2014. These loans had a face value of €5.38 billion, and Cerberus would go on to make a fortune as it sold these loans on to either their original borrowers or others. The circumstances of the sale of Project Eagle are the subject of various investigations.

From the summer of 2014 on, Kearney was flat-out trying to do a deal with Cerberus and refinance his loans. Tom Browne’s LeBruin approached Kearney with an offer from Marathon Asset Management to help him do this. LeBruin had done a bit of work for him before in relation to Nama, which Kearney had paid for. Kearney liked the LeBruin refinancing proposal but in the end, he went with a different deal with a US investment company called Jefferies LoanCore (JLC). It was a stressful period for Kearney and his team, as they sought to refinance his portfolio with JLC, and cut a deal with Cerberus.

However, in late August or early September 2014, Kearney received a phone call from James Ferris in a company called Arrow Capital. Ferris explained how he was acting for another overseas fund called CarVal, which had acquired a large volume of loans from the liquidators of Anglo Irish Bank. Arrow was now working through those loans on behalf of CarVal.

Among these loans was a debt secured on a bond in Anglo with a face value of €27 million that was owned by Kearney. It was a headache Kearney didn’t need at such a delicate time.

He decided to ask Browne to help him. It was a way of giving him something after all the work Browne had done on the Marathon deal, which had yielded no fees. Browne knew Ferris from their time together in Anglo, just as he knew lots of other former Anglo bankers who were now working for various overseas funds around town.

Browne had a good friend on the bond desk in Davy called Tony O’Connor, and he asked him to help out.

Browne, meanwhile, started talking to Arrow. Around October 2014 he reached a deal with the fund manager under which they would accept €2.36 million in return for releasing their charge. Kearney decided to split any profits made from selling his bonds above that price with Browne, but this was extended to include O’Connor too. It was unorthodox to cut O’Connor personally in on the deal, but as Kearney saw it, the structure ensured that all parties were all aligned and motivated to achieve the best possible price for his Anglo bonds.

O’Connor set about putting his side of the deal together. On October 28, 2014, he told Kearney using his Gmail account that “The market for these bonds is at best thin,” but he was “fairly confident” that he could sell them for more than what was required by Carval to settle his debt. He said the “danger to the transaction” was that Carval/Arrow realised that the bonds were worth more than they were being offered.

“Lets hope this works – usually if it is too good to be true it is bollix maybe this time its different,” O’Connor concluded.

By Friday, November 14, 2014, Tony O’Connor had found a buyer. It was a low-profile entity called the O’Connell Partnership. According to evidence given by Kearney in the High Court, he was told that the partnership consisted of Davy clients.

Bonds, bailouts and Tony O’Connor

Tony O’Connor is a stocky individual with long hair. He is not that dissimilar in appearance to a mid-career Jack Nicholson. Certainly, he has the confidence of a trader used to the cut and thrust of deals. He is numerate, quick-witted and uses colourful language, which is not unusual in his business. Like Browne, he is from Limerick originally. After studying business in UCD O’Connor had spent 11 years in the civil service before finding his true calling, when he started money broking with IIB Bank. After a year he moved to Fitzwilliam Money Brokers, where he also stayed a year, before joining another brokerage set up by Oisin Fanning, MMI, in the early 1990s. These were formative years for O’Connor, and he thrived in that fast-paced environment.

In 1995 he joined Davy as director of its money desk, a busy area to be in ahead of the arrival of the euro. In an era of high-interest rates, running the money desk involved a lot of interbank dealing and working with treasury teams in Ireland’s main banks along with overseas financial institutions.

Anglo was a Davy client, and O’Connor was tight with a number of its senior team including Browne. Money broking was a business based on relationships, and O’Connor was expected to entertain his clients regularly. He took to this side of his job with gusto for many years but later reduced the late nights as he got older.

Like many traders, O’Connor was interested in sports betting, but he later stopped this too. He was a sports fan and was known in Davy for being able to get his hands on tickets for matches – both locally and overseas. Browne, as a senior banker in Anglo, often ended up going to the same tournaments with his leading clients, so he would bump into O’Connor.  

Gradually, O’Connor moved more towards Davy’s bond desk as the arrival of a lower-interest-rate era and the euro meant the need for money broking reduced. His timing joining the bond desk in 2010 was good, as the need for bonds surged in the wake of the financial crash.

Based in the coastal village of Malahide in north Dublin, O’Connor lived near his boss Barry Nangle. Nangle lives in Abington, a luxury estate in Malahide, and his house was next door to David Drumm, before the former chief executive of Anglo Irish Bank’s fall from grace.

O’Connor lives a few roads away in a nice but more modest house, so he would often bump into Nangle outside work, or going to and from Dawson Street. O’Connor wasn’t that close to Nangle, but they were not unfriendly either. Nangle was his boss so there was a bit of distance there. O’Connor, with his closeness to the money market, saw the signs of the looming financial crash in 2008 earlier than most. In the chaos that followed, he proved his worth to the firm.

From 2010 on, he was full-time on the bond desk, making millions for Davy trading in what was a golden era for bond desks. Davy’s desk was considered the best in Dublin, and it was used by everyone from hedge funds looking for a quick turn to the Irish state. Ireland’s NTMA was determined to get back into the bond market, and it constantly reassured investors there would be no mass burning of bondholders. Many institutional bondholders didn’t believe them, and they dumped their positions in Irish state and bank bonds.

Gradually a number of large hedge funds were won around to the Irish story. Those that did so at scale made huge killings and paid out substantial fees to desks like Davy’s. This was the price Ireland decided to pay in order to exit the bailout and regain its economic sovereignty.

Kearney and his Anglo bonds

How did a former joiner from Belfast turned property developer end up owning €27 million worth of Anglo bonds? It is a complicated tale that goes back to the tumultuous years of 2008 and 2009. After Anglo Irish Bank was nationalised in January 2009 its shareholders were wiped out. Announcing its plans to take over Anglo the state was careful in what it said: “Creditors (including bondholders) of Anglo Irish Bank can be assured that it will continue to service its obligations and will repay its debts at maturity.”

One of the shareholders in Anglo wiped out when the bank was nationalised was Patrick Kearney. He only became a shareholder in Anglo because the bank asked him, along with nine other trusted long-term clients, to buy 1 per cent of the bank each in July 2008 from the tycoon Sean Quinn. To encourage the so-called ‘Maple 10’ to participate in the deal, the bank loaned them money at only 25 per cent recourse with the hope being this would stabilise the bank.

Anglo advanced this group of clients the money to buy its own shares, a structure that would later lead to a criminal trial and conviction of a number of its bankers. Presiding over this trial Judge Martin Nolan however said in 2014 that he had been impressed by the Maple 10. “They were certainly good men and acting with good motives,” the Judge concluded.

But that was all ahead. The problem facing Patrick Kearney after Anglo was nationalised was that he owed the bank a substantial sum in relation to the Maple 10 transaction. Kearney decided in 2009 to acquire subordinated bonds in the bank with a face value of €27 million, with the idea being these would act as a hedge against his Anglo debt. Kearney figured if Anglo tried to call in his Maple 10 loan, he could use his Anglo bonds to pay the bank off. The bank knew this was his thinking, which became important later as it linked his Maple 10 loan to his bond loan, raising questions about the bank’s security.

In any event, Anglo agreed to lend Kearney about €19 million to acquire his Anglo bonds. This could be seen as an unorthodox loan for a nationalised bank to make, but there was considerable paperwork explaining the business logic behind it. The loan was to be essentially “self-financing”, as the interest charged on Kearney’s loan from Anglo to buy its bonds roughly equated to the coupon due from the bond. The plan was that when the bank repaid Kearney €27 million when his bond matured, this would yield a profit of €8 million above its purchase price, which was money he would use to pay off the recourse element of his Maple 10 loan.

At the time Anglo advanced the money, Kearney’s estimated net worth was £125 million and he had £10 million in cash. He was considered good for the money. The bank’s credit committee and its new board, then including directors appointed by the state, approved the deal.

At the time, there was no sense from the state that it planned to liquidate Anglo, so its bonds were not considered a risky investment.

After 2009, Anglo asked Kearney several times to repay his share purchase loan, and he said he would give up his bonds in return. The bank did not accept this deal. Anglo did not however move against Kearney as there was now considerable uncertainty around the legality of the Maple 10 loan it had given him, raising question marks around its security.

In the end, Kearney’s various loans secured on his property portfolio in the North were dispatched to the National Asset Management Agency, including his Maple 10 loan. However, it held onto his loan secured on his bonds, as the bank’s management figured it could deal with it eventually. Kearney’s bond was years away still from maturing, so there was no particular rush.

The hunt by hedge funds for Anglo bonds

On February 7, 2013, Anglo, by then rebranded as the Irish banking Resolution Corporation, was dramatically liquidated by the state. This caused the value of Anglo Irish Bank bonds to nosedive to as low as 12 cent in the euro, amid fears that liquidators would burn bondholders. But it didn’t take that long for the price of Anglo’s bonds to start ticking back up. For one thing, within six months afterwards questions started being asked about whether there was a need to liquidate Anglo at all.

Mike Aynsley, the former chief executive of Anglo, told me in an interview on July 28 2013, that up until the bank was placed into liquidation “the bank was solvent and in full compliance with its capital requirements…” But that was just the opinion of one man in an interview, albeit a credible one.

In October 2013, the former board of Anglo chaired by Alan Dukes, a former Fine Gael minister, lodged an official statement of affairs with the Department of Finance stating that the bank was solvent up until the moment they were removed as directors. The board claimed the state had taken a number of steps that created a situation that meant the bank had to be liquidated. Anglo’s old board said there were financial machinations by the government that essentially created a €3 billion hole in Anglo. By changing the valuation of a promissory note, it had made the Anglo balance sheet insolvent.

A number of hedge funds had worked this out too and threatened to sue the liquidators of Anglo and the state, as they believed the liquidation had been “contrived” to burn their bond holdings. Prior to the liquidation some of these funds had been buying Anglo bonds at 10 cents to 20 cents in the euro or depending on the terms of the bond, sometimes higher. So there was a lot of money at stake.

A group of hedge funds were informally talking. They were tough, well-funded and used to getting their way using litigation. Assenagon, a German hedge fund, had successfully sued Anglo Irish Bank in 2012 in England preventing it from pushing through a “coercive” buyback of bonds. In a note to clients, English law firm Brown Rudnick described this as a “dramatic vindication of bondholder rights”.

The results of this ruling were pored over by lawyers and advisors for the hedge funds, as they planned to fight any attempt to burn them.  Munich-based Xaia Investments, headed up by Dr Wolfgang Klopfer, confirmed in an August 2013 interview it had a position in Anglo bonds. It said it expected to be paid in full and would sue to ensure it was. “I expect a European government to act within the laws and once they act within the laws, there is no need to sue,” Klopfer told The Sunday Independent. “I’m very confident that they will do it – and if they don’t do it, yes [he would sue].”

And then there was the biggest beast of all. Burlington Alpha and Burlington Beta, two funds linked to Elliott Management. The giant hedge fund controlled by US billionaire Paul Singer, came on to the pitch in September 2013. They tried to protect subordinated bonds they owned with a face value of $75 million by forcing Anglo’s liquidators to use its US-based assets to repay them. Elliott Management was a formidable foe who had defeated Argentina in a long-running corporate war when the Latin American country had tried to burn one of its investments. These were very serious players who let it be known in the market that they were interested in buying more Anglo bonds if anyone wanted to sell them.

As all of this talk of litigation was going on, KPMG, as liquidators of IBRC/Anglo, were swiftly disposing of its assets. Time and again, it did better than expected as confidence in the Irish economic story returned.

Some of the bank’s best clients repaid their debts in full, almost an impossibility a few years earlier. In December 2013, management at Davy acquired its loans of €140 million, at a minor discount of €4 million, reflecting the cost incurred in refinancing their debts with Bank of Ireland.

But the real big deals were done by giant funds and investment banks which were paying billions to buy swathes of loans. Deutsche Bank, Lone Star, Goldman Sachs, Oaktree, and Carval were all buying huge amounts.

On June 6, 2014, KPMG published its first progress update. This showed the liquidation was attracting huge interest, and KPMG had managed to sell €20 billion of loans. That summer and towards the autumn of 2014 the talk within Anglo was that a surplus was possible, and as time went on this sense grew not just in the former bank but also outside it. The cases being taken by the various hedge funds lurked in the background, but they didn’t progress as they began to see they mightn’t need to litigate, but just had to wait.

This possibility of a surplus caused Anglo’s bonds to rise. A number of hedge funds were hunting for them, often like Elliott adding to substantial positions they already held. They let it be known in the market they were out there and ready to buy, both among Dublin-based brokers like Davy, Goodbody and Cantor Fitzgerald, but also in London. 

A factor that had to be considered by any bond purchaser was a long-running case being taken against the bank by the family of Sean Quinn. The Quinns were looking for €4.5 billion, which if successful, would wipe out any surplus. While few believed the Quinns would get that much, it was not seen as impossible in 2014 that they might get a substantial sum. Hence, Anglo’s bonds, while rising, still traded significantly below par. The Quinns had been caught “asset stripping” by the bank and the view was the state was never going to pay the family anything near what they were asking for. Another factor at play was politics. Paying out money to Anglo bondholders would be controversial, but it was felt it was very unlikely the government would block such a deal for fear it might impact Ireland’s ability to raise money in the markets. So, there was some uncertainty, and as a result, Anglo’s bonds traded at a discount, but it was one that seemed to be narrowing over time.

Getting to potential buyers of Anglo bonds wasn’t easy for the man on the street. Pricing wasn’t readily available as it is for ordinary shares. It required specialist bond desk experience to know the type of funds that were interested in buying them.

The other issue Patrick Kearney had was that he was considerably indebted at the time to Cerberus which had control of his property loans in the North. He needed a temporary unsecured loan from somewhere, which a conventional bank would never have given him. He went to Tony O’Connor and Tom Browne to solve this tricky situation.

Tony and Tom

In his October 2014 emails, Tony O’Connor presented himself to Patrick Kearney as having the knowledge that the developer required. That is why Kearney agreed to give him a profit share in order to motivate him to get the highest price he could. The person O’Connor most admired in Davy was Tony Garry, its uber-wealthy then chief executive who lives in Foxrock, Dublin 18. The two men got on.

Garry was from a bond market background too, and, like O’Connor, he was a former civil servant too. It was the final months of Garry’s tenure; he was due to officially step down in March 2015.

O’Connor wasn’t that close to Garry’s anointed successor Brian McKiernan, as he was from the private wealth side of Davy’s business. McKiernan took a more metrics-based approach to making money, while Garry was seen as more of a relationship-based dealmaker.

Garry had helped O’Connor at times over the years, as he had many others in the firm. O’Connor had a reputation for being quick witted. His sense of humour could be cutting, so younger staff found him a little intimidating, but he was very loyal to the company, as it had been to him during good times and bad.

Tom Browne was a close friend of O’Connor. Browne was for many years the wealthier of the two friends with a net worth estimated by his old employer Anglo of €60 million at its peak. Like O’Connor he was from Limerick, and he’d been a talented Gaelic footballer in his time and was part of a team that almost beat Kerry in the early 1990s.

Back in 2004, Browne had been seen as a contender to replace Sean FitzPatrick as CEO of Anglo, but he was beaten to the job by a younger and less experienced banker called David Drumm. Browne had joined Anglo in 1990 from AIB. He had been Drumm’s boss, and he was the person Drumm thought should succeed FitzPatrick. 

Whitehead Mann, a British recruitment firm that was advising Anglo on filling the job, described Browne as a “safe pair of hands.” But it concluded the popular banker “lacks the steely edge” of many chief executives. Whitehead Mann didn’t choose Drumm either. Nonetheless, on September 22, 2004, Anglo announced that 37-year-old Drumm had got the job. According to Simon Carswell’s book on this time, Anglo Republic, Drumm had gone back with Browne to his office afterwards, and seen the Limerick man in tears, and repeatedly punching the wall. Despite the setback, Browne stayed on a for a few years. He was on considerably more than €1 million a year, but ultimately he wasn’t happy.

In early 2007, he handed in his notice, and in October 2007 he officially left the bank. Browne went out into business on his own and in partnership with a banker from AIB called John Hughes.

Browne was now rich, and he borrowed big sums from various banks to acquire investment properties in London. He invested in property in Portugal, Antigua, Dubai and Shanghai. Nearer to home, he bought property in Kerry, Limerick, Galway and Malahide, but his main home was in Foxrock.

In 2002 he opened a CFD account in Davy, and he had CFD accounts too in Bloxham and NCB. His account in IG Markets in association with Davy was used to trade regularly in the markets.

Browne’s wealth was anchored in his Anglo shares worth millions, and most of his investments were property-related. By early 2009, Anglo’s shares were worthless, and he was in trouble financially. He’d put money into investments like Taggart Holdings, a construction company that later went bust. A receiver appointed by Anglo made one of his companies sell a prime asset in London called Bishopsgate in 2012 despite his protestations that the bank should wait, crystallising big losses.

Browne was now reported to owe Anglo tens of millions of euro. He had valuable assets, but the bank wasn’t prepared to wait for them to rise in price.

Browne countersued Anglo saying that the bank had kept secret from him the extent of the danger it was in because of a multibillion CFD gamble on its shares by a tycoon called Sean Quinn, and that if he had known this he would have sold his shares in Anglo, allowing him to clear his debts to it.

A standoff ensued between the bank and Browne for years, with both threatening to sue each other. As there were various criminal cases being taken against other former Anglo bankers which related to issues Browne planned to raise in his civil case against the bank, both sides couldn’t for a long time go to court.

It was only in February 2021 that this case was settled mid-trial, and Browne accepted a judgement in the sum of €30 million being entered against him by the liquidators of his former employer.

Prior to the case being settled, Browne had given evidence of travelling to Russia and Ukraine with Quinn in July 2007 to view various properties and asking him directly about his position in Anglo. Browne was just a few months away from leaving the bank to go into business at the time, and he recalled Quinn’s response.

“He laughed at me and said in a jocular fashion, ‘Sure if I told you that I’d have to kill you,’” Browne said in his evidence.

In the interim years as he awaited this trial, Browne worked with LeBruin, a business he co-founded with Cathal Fitzgerald, another ex-Anglo banker. Fitzgerald had an MBA from Boston College, before working with Standish Mellon in the United States. He came back to Ireland in the late 1990s to work for Dermot Desmond’s IIU, before joining Anglo’s private wealth arm in 2000. LeBruin initially specialised in advising developers on their dealings with Nama and other banks post the crash. But as the years went on, they broadened their business as they helped developers build new projects, or pay off their legacy debts. LeBruin was founded in March 2008, and it had the backing of three big developers.

Two of them were developers called Joe O’Reilly and Sean Reilly, who were also members of the so-called Maple 10.

The third shareholder was Rose Castle Unlimited, a company associated with Cork developer Michael O’Flynn. The three developers, it is important to note, are not active in the day-to-day activities of LeBruin, and knew nothing of what was to unfold with Kearney. All of them are very respected business people.

In May 2012, Browne sold his shares in the business to Fitzgerald, giving his cofounder 85 per cent. Browne remained as managing director of the company. The fact Browne had his own financial battles was not seen as a negative, as so had many of LeBruin’s clients in its early days.

Browne was liked and respected by developers because he helped them get back on their feet. Now it was time to help his old friend Patrick Kearney, or at least that was the plan.

Part 2: Anatomy of a bond trade and how Kearney sought to back out of the deal