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The Chancer Who Ran Amok

Posted on: March 21st, 2010 1 Comment

SAINT Patrick is not a lucky patron saint for Sean FitzPatrick.

Two years ago, on St Patrick’s Day, hedge funds attacked Anglo Irish Bank shares on London’s stock market. The nation’s day of celebration marked the beginning of the end for Anglo.

Last Wednesday, as the St Patrick’s Day celebrations were ending, the gardai were planning a dawn raid on FitzPatrick’s luxury pile in Greystones’ plush Burnaby Estate.

It has been a tumultuous two years for FitzPatrick. Eighteen months ago, he was super rich, still walking on water, feted by global bankers, politicians and captains of industry. Today he is broke, helping the gardai with their inquiries.

What brought him down?

Sean FitzPatrick was always a man on the make. He was an opportunist par excellence. There is little evidence of wrongdoing in his early days at the bank. Certainly he was a risk-taker; indeed he had qualities that, on their own, deserve to be applauded. Initially he went flat out to challenge Ireland’s established bankers, the dominant forces for decades.

His opportunism was both his greatest asset and his biggest liability. He spotted gaps in the services offered by his banking rivals. Where other banks took weeks, he was willing to offer 24-hour turnaround responses to loan applications.

Businesses large and small flocked to Sean’s bank. They liked the style of the quick- fixer of St Stephen’s Green. Property developers loved the fast-buck culture, the whiff of cordite from Anglo’s headquarters. And they loved Seanie.

Maybe not quite as much as Seanie loved Seanie.

Seanie had spotted the lack of regulation. He realised that lending to property developers was a doddle; that the regulator was a pushover for the bankers; that politicians were in the property developers’ pockets; that the Department of Finance was a paper tiger; that bankers — the source of all this phoney prosperity — were the new masters of the universe. And he was the king of the castle.

The scene was set for a chancer to run amok.

He even forced the stuffy old guard of Ireland’s bankers to follow him into the property abyss. Titans like Eugene Sheehy of AIB and Brian Goggin of Bank of Ireland brought both their banks close to ruin in pursuit of Seanie into the property furnace.

But just as Eugene and Brian began to ape Seanie, he began to ape them.

Sean FitzPatrick grew to believe his own propaganda. He started to take bows and baubles from the business community.

The tell-tale sign was the day in 2000 when he sought — and was awarded — the presidency of the dreaded Irish Bankers Federation (IBF), lobbyists for the bankers during the property bubble.

No entrepreneur with an ounce of self-respect would have touched such a bauble with a bargepole. Whatever about self-respect, Sean had developed plenty of self-esteem. He grabbed the IBF gig with open arms. Vanity had taken over. He craved recognition.

And then he started to make those speeches about integrity.

Later that year he launched the bankers’ Code of Ethics. His speech was staggering stuff from a banker, let alone from Sean.

“The principles of integrity,” he boasted, “confidentiality, professionalism and compliance are the most basic of modern banking and we have gone to some pains to ensure that they are at the heart of this Code of Ethics. . . Trust is important to us and we are determined to rebuild it.”

Two years later in 2002, he was made the Business & Finance Person of the Year. He relished such recognition, including his later elevation to the highest echelons of the Institute of Chartered Accountants of Ireland. He was basking in recognition from such useless outfits.

Sean the outsider was on the inside track of Irish business. Simultaneously he was revered by naive politicians. So revered that in 2004, Minister for Transport Seamus Brennan asked him on to the board of the semi-state Aer Lingus where he became the senior independent director (commonly known as SID).

The SID’s job is to promote high standards of corporate governance.

It would be fascinating to know how Sean squared his duties as the policeman of high standards of corporate governance at Aer Lingus with the low standards of corporate governance at his first love, Anglo Irish Bank.

Despite disapproval of such a move in the corporate code, in 2005 his leap from chief executive to the chair at Anglo was allowed by a compliant board.

He was the master of cross-directorships. He sat on the board of the controversial Dublin Docks Development Authority (DDDA), along with fellow Anglo director and business partner Lar Bradshaw. He held a seat on the board of Greencore, was a director of Aer Lingus and chaired Smurfit Kappa.

In turn, Greencore chair Ned Sullivan and Smurfit chief executive Gary McGann adorned the top table at Sean’s Anglo. He was flaunting his contempt for the rules of corporate governance, aimed at stopping too much power falling into the hands of one individual.

He is living proof that the tedious code of corporate governance is there for a good reason. Specifically, when a strong character emerges, he can become a corporate despot.

Sean’s talks with the gardai may or may not lead to further developments. That is hardly the point of the FitzPatrick story. After achieving great wealth he became intoxicated with the adoration of fawning business audiences. He relished the attention attracted by his after-dinner speeches.

Even after the darkest day — September 30, 2008 — when the bank guarantee rescued him and his colleagues from oblivion, he wanted to go out and sock it to the masses. Less than a week later, he did a disastrous interview with RTE’s Marian Finucane when he refused to apologise for bankers’ reckless behaviour.

Instead, he rubbed salt into the wounds of those taxpayers whom the bankers had wronged. At that critical time, an opportunity for humility and reticence, he was gagging to go public.

The same evening he was the guest speaker at a formal dinner in Greystones where he lectured the assembled diners on the need to review both child benefit and medical cards for the over-70s. He wanted to take money out of the pockets of the oldest and the youngest in Ireland.

A few days later, I heard him speak to a business dinner in Dublin. It was the same self-satisfied speech: the Anglo story and how Sean had built the bank from humble beginnings to the success story it was on that day.

Which, of course, it was not. It was toppling as he spoke. He was living on Planet Hubris.

Within two months, Sean had resigned. Within three months, Anglo was bust and nationalised.

No one can walk on water. Not even Sean FitzPatrick on St Patrick’s Day.