Bankers Caught Joking on Tape About Not Paying Back Bailout

Bankers caught joking on tape about not paying back bailout
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By Julia La Roche

Once again, we have more embarrassing conversations between bankers.

The Irish Independent, a Dublin-based newspaper, has uncovered tapes of an internal phone conversation from September 2008 between two executives at Anglo Irish Bank during its bailout deal and they sound pretty scandalous. The Irish Independent points out that the recordings show they misled the Central Bank.

The executives from the recording have been identified as John Bowe (head of the bank's capital markets) and Peter Fitzgerald (director of retail banking).

However, Bowe "categorically denied" that he misled the Central Bank and Fitzgerald, who wasn't involved in discussions with regulators, said he was unaware of any intention to mislead, the report said.

Either way, the newly revealed recordings are still embarrassing.

Here are some partial excerpts (via the Irish Independent):

The two bankers begin their conversation jokingly comparing themselves to being able to walk on water and drink beer out of both hands.

John Bowe: "Hello"

Receptionist: "John I have Peter Fitz for you."

Bowe: "Oh yeah, OK."

Bowe: "As me granny used to say, you must be therapeutic..."

Peter Fitzgerald: "What does that mean? Can I work the computer is it? (Both laugh)

Bowe: "Therapeutic. Therapeutic...I was just ringing you."

Fitzgerald: "I'm ambidextrous as well. It means I can walk on land and water." (More laughter)

Bowe: "You can drink, you can drink beer out of both hands..." (laughter)

Then they get down to business. Bowe tells Fitzgerald that they met with the Irish Financial Services Regulatory Authority (IFSRA) the previous day about getting €7 billion. They laugh how they will never be able to pay it back.

Bowe: "So we went down ... and we basically said. In Central, yeah. And I mean, to cut a long story short we sort of said. 'Look, what we need is seven billion euros...and we're going to give you and we're going to give you, what we're going to give you is our loan collateral so we're not giving you ECB, we're giving you the loan clause.

"We gave him a term sheet and we put a pro not facility together and we said that's what we need. And that kind of sobered up everybody pretty quickly, you know."

Fitzgerald: "Yeah."

Fitzgerald: "And is that €7 billion a term?"

Bowe: "This is €7 billion bridging."

Fitzgerald: "Yeah."

Bowe: "So ... so it is bridged until we can pay you back ... which is never." (Both laugh)

Then they joke how the regulators would need to change their underpants after hearing the terms of that deal.

Bowe: "So under the terms that say repayment, we say; 'No ...'" (laughter)

Fitzgerald: (Laughing) "None...just none. Not applicable. OK and what did he say? 'I need a change of underwear?'

Fitzgerald: "Jesus that's a lot of dosh ... Jesus f-----g hell and God ... well do you know the Central Bank only has €14 billion of total investments so that would be going up 20 ... Gee..that would be seen.

Bowe: (Laughing) "There was a bit of that ... there was a bit of that. 'And how would we do that? We would need to give you ... we need to ... 'Jesus you're kind of asking us to play ducks and drakes with the regulations.' And we said: 'Yeah.' We said: 'Look what we are telling you is if we get into difficulties, we have 100,000 plus lump sum depositors in Ireland all of whom would be very vocal.'"

Fitzgerald asks Bowe how he came up with the 7 billion figure. Bowe responds that like then-CEO David Drumm, he picked it out of his "arse."

Fitzgerald: "Ah we are, yeah, yeah and, em, what, how did you arrive at the seven?

Bowe: "Just, as Drummer would say, 'picked it out of my arse', you know. Em ... I mean, look, what we did was we basically said: 'What is the amount we can securitize over the next six months?' And basically say to them: 'Look our problem is time, it's not our ability to create the liquidity, the enemy is time here.'"

Fitzgerald: "Yeah."

Bowe: "So we can rebuild, in other words, we can rebuild the liquidity off our loan book, but what we can't do, we can't do it now and the balance sheet's leaking now."

Bowe tells Fitzgerald that they actually need more money than the 7 billion figure.

Bowe: Yeah and that number is seven, but the reality is that actually we need more than that. But the strategy here is you pull them in, you get them to write a big [check] and they have to keep, they have to support their money, you know."

Fitzgerald: "Yeah, yeah, yeah, yeah, yeah. They've got skin in the game and that's the key."

Bowe: "They have and they have invested a lot. If they saw, if they saw, the enormity of it up front, they might decide, they might decide they have a choice. You know what I mean? They might say the cost to the taxpayer is too high. But ... em ... if it doesn't look too big at the outset...if it looks big, big enough to be important, but not too big that it kind of spoils everything,

Fitzgerald: "Yeah, Yeah."


We've also embedded one of the recordings below:

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Didn't proof read it. Chrysler and GM paid back the money they received but the wallstreet banksters snubed their noses at the Government. What party do the banksters represent ???

July 02 2013 at 7:59 AM Report abuse rate up rate down Reply

First Chrysler and GM pays back their money but the wallstr go figure !!!!eet banksters snub their noses at the Government. What party do the banksters represent ??? go figure !!!!

July 02 2013 at 7:55 AM Report abuse rate up rate down Reply

moron this was not even americans

June 28 2013 at 11:23 PM Report abuse rate up rate down Reply

see, this is what I don't understand. How are these guys NOT in prison?

June 27 2013 at 5:01 PM Report abuse rate up rate down Reply

You know are banks were saying the same thing. They believe they are legit companies and what they do is right. God forbid if someone robbed them of 25 dollars, they raise high hell to destroy that man's life, even if he needed the money to feed his kids.

June 25 2013 at 12:13 PM Report abuse +1 rate up rate down Reply

Don't you know there were bankers and mortgage holders laughing about this exposure in Ireland? It may not be documented or recorded, but here has been gross malfeasance and dereliction of fiduciary functions of American banks!

June 25 2013 at 12:11 PM Report abuse +1 rate up rate down Reply

nothing funny here, step back in time when men and women had some ideals, these scumbags would have been hung for the crimes they committed , but like gas prices were to lazy to be real americans and say enough,,this is enough to get you serious penalties , why is this being ignored,shouldnt read these articles ,its our own fault

June 25 2013 at 11:58 AM Report abuse +1 rate up rate down Reply

why shouldn't bankers(everywhere) be laughing.They are above the law. Has anyone gone to jail for the 2008 crash? In the savings and loan scandal of the 80's 2000 bankers went to jail. This time-zero

June 25 2013 at 11:22 AM Report abuse +1 rate up rate down Reply

Can you imagine if this is what a Irish bank said about that small amount, imagine what American bankers said? We American taxpayers got so screwed on our bank bailout. Only the wealthy did okay in our country. They still aren't paying the tax bracket they should that would cover so much of the infrastructure needs of our country.

June 25 2013 at 10:36 AM Report abuse +1 rate up rate down Reply

Hah, hah! Finally, those NSA wiretaps come to good use!

June 25 2013 at 10:18 AM Report abuse +1 rate up rate down Reply