Mr. Diarmuid O'Flynn:

The €31 billion is already in circulation so nobody would actually be paying the debt. It is already out there; it is in circulation. What the Central Bank is doing is taking it back out of circulation. That is what the destruction of the money is about. Nobody would actually be paying for this. It is just money that is in circulation.

On the use of the emergency liquidity funds and the ECB's responsibility in that area, the argument we are putting forward is that the grounds on which the emergency liquidity assistance was granted were wrong. Its granting broke the ECB's rules and regulations. This assistance was for banks suffering from liquidity problems. It was specifically not for insolvent banks. Those banks presented a false picture of their true state of affairs. It was a false picture of which the ECB should have been aware. They were using accounting standards as opposed to the law in order to get around those EU rules and regulations. I have the actual promissory note; it is literally just a note. The ECB must have known then that these banks were not suffering liquidity problems. There were insolvent banks. That money should never have been issued. That is the argument we have made. It should never have been issued. As the bank of last resort and as the central bank of all the central banks of Europe, the ECB should have said "No".

The ECB at the time feared that if any bank in the eurozone failed, even one of the smaller Irish banks, the system would break down because of the domino effect. This is on the record. It felt that it would bring down the entire eurozone banking system. It was right. As I have shown in my presentation, the Bank for International Settlements calculated that, at that time, the German banks alone were exposed to the banks of the periphery to the value of more than $700 billion. If they went down, the big banks across Europe - Deutsche Bank, Bank BPS and so on - were also going to come down. There was a study done late last year by a German university on where the so-called Greek bailout funds went. I can send the Deputy the link. It found that 91% of the €240 billion or €250 billion that supposedly went to Greece actually went straight out the back door to the German, French and other banks that were exposed to Greece. I have read that in there as well. The ECB was right in its fears. That is why it demanded that the Irish banks pay everything and would not let them to fail on anything. That is also why it allowed the use of the emergency liquidity assistance fund for insolvent banks. It wanted them to keep their doors open.