Last week, finally, some of the top bankers who helped to destroy the Irish economy faced a court.  

It’s too little, too late, of course.  The heads of all the Irish banks during the boom should be on trial.  

Instead we have just three bankers from Anglo Irish Bank, and they should have been in the dock a long time ago along with all the other bankers, the senior civil servants and the regulators and politicians who allowed the catastrophe to happen.  

Still, it’s like the answer to the question about what you call 50 dead lawyers at the bottom of the sea.  It’s a start.  
The trial, with senior lawyers on all sides, is set to run between three and five months, which means it is going to cost a fortune.  

And who will be paying?  Me, of course, along with all the other taxpayers in Ireland. Before this is over we will wish all the rich lawyers involved were 50 fathoms under the waves.

The sad thing is, this trial is not even about the central issue, the outrageous behavior of all the banks here during the boom. It was their insane lending frenzy that ended in disaster and brought the country to its knees, while the Central Bank, the Financial Regulator and our political leaders were still telling us everything would be okay.

The crisis happened because financial and regulatory rules were being ignored or undermined in a manner that in many cases must have been illegal.  Yet none of the top dogs has faced trial on this central issue.   Almost all of those involved have sailed off into the sunset with their big payoffs and fat pensions.

Instead what we have here is the trial of three former Anglo Irish bankers on charges that relate to how they handled the mad Contracts for Difference (CFD) shareholding in their bank built up in secret by Sean Quinn.

You will have heard of Quinn.  In 2008 Forbes magazine said he was Ireland’s richest man, worth $6 billion.  A self-made man from humble beginnings in Derrylin, a rural backwater in Co. Fermanagh near the border, he started off driving a truck delivering gravel and built a business empire in cement, glass, insurance and so on.

"The Wolf of Wall Street" is wowing people in cinemas here at the moment.  Quinn was once the fox of Fermanagh.  Or maybe the donkey of Derrylin would be more accurate, since he said himself when he gave evidence in court this week that he had been “a fool.”

Not content with the vast fortune he already had, in 2006 and 2007 Quinn took a huge gamble on Anglo Irish shares through financial derivatives called Contracts For Difference or CFDs.   And the court in Dublin heard all about these over the past week.  

A Contract for Difference is a financial gamble based on the future price of a share. If the price goes up the investor gains but if the price goes down he loses. The price change is called the difference.  A contract is signed between a buyer and a seller, hence the name Contracts for Difference.

At the time of purchase the investor only pays a small percentage of the share’s actual price.  But he’s on the hook for the lot and if the share price goes down he’s in trouble.

And in Quinn’s case it was big trouble when the Anglo price started to plummet as the international financial crisis began to take hold.

Using eight CFD providers to cover his tracks (including Lehman Brothers!) Quinn’s indirect secret stake in Anglo Irish eventually got as high as 29 percent in March 2008.  He told the court this week that he kept buying because he believed the reassurances he was getting both from the authorities and Anglo Irish.  He said he thought the bank, which had been the most exciting player in the property boom, was a great investment and that the price was bound to recover.

Instead the shares kept falling.  In cases where the share price is falling, holders of CFDs have to meet margin calls (part payments of the potential loss).

In Quinn’s case this amounted to hundreds of millions. He told the court this week that he had lost €3.2 billion in 2007 and 2008 on his Anglo Irish investment.

The problem was that Quinn didn’t have the money and was already in trouble for taking funds out of his insurance business to meet margin calls.  This was a huge problem for the bank because if the Quinn position was closed off it would have collapsed the Anglo Irish share price.

So the bank allowed Quinn to borrow hundreds of millions – eventually €2 billion – to meet the margin calls and prop up its own price.   Which is illegal.

And that’s why the three top Anglo Irish bankers were in court this week.  The prosecution case is that Pat Whelan, Anglo’s former head of lending, William McAteer, former chief risk officer, and the bank chairman Sean FitzPatrick, were involved in a plan by Anglo to loan money to the Quinn family and the so-called “Maple 10” group of investors so that they could buy shares in the bank and guarantee the stability of the share price.

The 10 investors were mega wealthy individuals who were important customers of the bank.  In effect they were being asked to pick up the Quinn shares in Anglo Irish and Anglo was loaning them the money to do so.

Or in other words, the bank was loaning people money to buy its own shares. Which, as we said, is illegal.

We will see how all this plays out in the weeks and months ahead.  But already some interesting facts have emerged in the first few days of the case.

For example, we now know that the Financial Regulator was directly involved in meetings, including a meeting with Quinn, as the situation unfolded.  It is stretching credibility to believe that he did not know what was happening.   Similarly with the Central Bank.

And if those guys knew what was going down, are we really supposed to believe that the senior people in the Department of Finance and the top politicians in the government had no idea what was happening?

It’s hard to have any sympathy for the Anglo Irish bankers.  But they’re not the only ones who should be on trial.

It’s also hard to have any sympathy for Quinn.  Famously he was a man with simple tastes even when he was Ireland’s richest man.  His favorite pastime was playing cards with old friends in games where the maximum stake was a few cents.

Clearly he was way out of his depth messing with CFDs.  Now all the money has gone and he has been publicly humiliated – but he only has himself to blame.