Former Anglo Irish Bank chief executive David Drumm has said he completed financial statements in his US bankruptcy case in 2010 "as best I could" but that he forgot to include a number of large transfers among a total of $1.2 million in transfers that he made to his wife Lorraine in 2008 and 2009 which he initially failed to disclose.

Mr Drumm was testifying on the first day of a trial in the Massachusetts bankruptcy court in which his former bank, now Irish Bank Resolution Corporation, and the trustee managing his bankruptcy case are trying to get the court to deny his discharge from bankruptcy and stop him being given a fresh financial start.

They argue he should not be entitled to a discharge because he concealed assets and defrauded creditors by transferring the sums of money to his wife in 2008 and 2009.

The plaintiffs allege he made false oaths by failing to disclose the transfers in his bankruptcy statements. He claims the only transfers falling within a one-year time limit on fraudulent claims went to his creditors and that any omissions in his statements were “honest mistakes.”

The court heard the former banker started transferring money to his wife during the financial crisis in September 2008, a month he described as "Armageddon" in the banking industry when the world was "falling apart" following the collapse of the US investment bank Lehman Brothers.

Mr Drumm agreed under questioning by attorney John Hutchinson, representing IBRC, that he started making transfers to his wife at a time when Anglo was facing enormous liquidity pressures, a plummeting share price, the prospect of Government intervention and a potential loss of independence.

“It was a very, very difficult time with a lot of unknowns,” said the former bank chief executive, who declined to answer questions from reporters as he entered the court building.

During testimony, he was asked at length about financial statements made after filing for bankruptcy in Massachusetts in October 2010 and why he failed to disclose transfers to his wife, Lorraine.

He admitted his US accountants advised him before filing statements that he could get in trouble if he did not disclose all asset transfers over the previous two years before his bankruptcy petition.

He recalled being told by his advisers that he had to disclose all cash or property transfers in the bankruptcy process, that “you had to get naked in public,” Mr Drumm told the court.

Mr Hutchinson noted that Mr Drumm told a creditors’ meeting in February 2011 that he believed that he only had to list property transfers in his statements, but that he included the transfer of his Anglo shares to the Minister for Finance after the bank’s nationalisation, just one of two transfers disclosed.

Asked if he knew that he was required to disclose all transfers over the previous two years before filing for bankruptcy, he said: “I know that now.”

In an opening statement before Mr Drumm entered the witness box, Mr Hutchinson told Judge Frank Bailey that the former banker had engaged in "classic fraudulent transfers" to his wife.

He described him as a debtor who had “not earned his discharge” and “made a mockery” of the bankruptcy process by making false oaths and showing “callous indifference” to his responsibilities.

Mr Hutchinson said there were a “staggering number” of omissions and mistakes in financial statements made in the bankruptcy case relating to transfers of cash and property to his wife and that it could not be reasonably said that he had been done in good faith given his training and experience.

The bank’s lawyer told the court that Mr Drumm was a person who routinely made false statements since 2008 under oath to the trustee, to the bank and even to his own advisers.

Mr Drumm would argue in the trial that his advisers should have questioned him more about what he was disclosing in his bankruptcy case and that the advisers would “fall on their swords,” he said.

“Was this their finest hour? Perhaps not. But a person who fails to uncover the deceit and reckless of another is not the quilty party. There is no sword to fall on. The wound here was self-inflicted,” he said.

Presenting Mr Drumm's defence, his attorney David Mack argued that a 60-page brief filed by the bank and trustee outlining the case against the former Anglo chief executive was rife with invective, riddled with personal attacks on Mr Drumm and filled with hyperbole.

Mr Mack said the bank and trustee had “very bold statements” about Mr Drumm, claiming he will “lie at the drop of a hat” or that he is “a serially dishonest debtor,” but these are “catchy” statements and “make for juicy quotes” for the reporters in the courtroom.

He argued that the case seeking to deny Mr Drumm a discharge was based on transfers within one-year period of his filing for bankruptcy but the only transfers made during that period were $73,000 paid to creditors and that $53,000 of this was transferred to an account in Ireland to pay Irish taxes.

Mr Drumm’s financial affairs were “turned upside down and inside out” as he prepared to file for bankruptcy and he knew that everything he disclosed would be “under the microscope,” he said.

Mr Mack told the judge that he will see that the case by the bank and trustee against Mr Drumm was “a lot of bluster and argument but short of true evidentiary substance.”

The case continues this afternoon when Mr Drumm will continue giving evidence. The trial is scheduled to last five days.