“The [Anglo Irish] bank is now of course owned by the State.”

It looks like there could be a whole new story to tell about Sean Quinn and his stake in the now nationalised Anglo Irish Bank. The Irish Times reports that it understands the Irish Financial Regulator intervened last year when they discovered the Quinn family “had built up a stake [in Anglo Irish] of 25 per cent by way of contracts for difference” – a stake that, legally, they didn’t need to declare. The 15% stake they did eventually declare came after, the Irish Times understands, approximately 10% was bought by a group of wealthy individuals rather than the shares going on the open market. The regulator is now reported to be investigating just how that happened and whether loans from the Anglo Irish Bank were used in the purchase of those shares. In his analysis piece in the same paper Colm Keena sums up the situation

The owner of the State’s largest privately owned business was betting enormous sums on the share price of the State’s third biggest bank and using a method (contracts for difference) that meant the markets had no entitlement to know what he was up to.

Then, when the financial regulator somehow got wind of the size of Seán Quinn’s involvement in Anglo Irish Bank, the position was unwound in such a way that something in the region of 10 per cent of the bank’s shares changed hands without going on to the market.

Update From today’s RTÉ report

Taoiseach Brian Cowen has told the Dáil that matters surrounding Sean Quinn’s stake in Anglo Irish Bank may have to be investigated further by the Financial Regulator. He said that the Minister for Finance Brian Lenihan was aware over the course of the last year that a large overhang of shares in Anglo was held by a particular investor and related persons.

And [Colm Keena] has a few questions

Key questions arise from that fact. Who managed this process? To what extent, if any, did Anglo Irish Bank fund the purchasing of the shares by the persons who ended up owning them?

If the bank loaned the money to the purchasers, then did it know the background to the transactions?

Did the bank knowingly give money to business figures who were seeking to shore up the bank’s share price?

Was the market for the bank’s shares being manipulated with the aid of the bank’s money?

And it doesn’t stop there

The bank is now of course owned by the State. The financial regulator has known about Quinn’s involvement in Anglo since early to mid-2008, when pressure was put on him to reduce his involvement and declare his ownership.

On that basis one would think that the Department of Finance, Minister for Finance Brian Lenihan and Taoiseach Brian Cowen must have known about the matter when they were deciding on the fate of Anglo Irish Bank during the evening, night and morning of September 29th/ 30th last.

There was a Bill available on that night providing for the nationalisation of Anglo, but it was decided the inclusion of Anglo in a State deposit guarantee scheme for all the major banks was a better route to go down.

Mr Lenihan has said he did not know at the time about former Anglo chairman Seán FitzPatrick’s hidden loans from the bank.

Did he know the background to the Quinn saga?