January 18, 2012 by staff
Anglo Bank, A famed entrepreneur who was once rated Ireland’s richest person was declared bankrupt yesterday as a bank pursues him for debts exceeding â‚¬2.1 billion ($3.3 billion).
Lawyers for tycoon Sean Quinn withdrew his opposition to a Republic of Ireland bankruptcy order sought by the former Anglo Irish Bank, the reckless lender at the centre of Ireland’s calamitous property crash.
The bankruptcy judgment will force a thorough court investigation of Quinn’s finances, which the bank hopes will reveal capital and assets that it can reclaim from Quinn, his wife and five children.
Quinn, 64, did not attend yesterday’s court hearing. He issued a statement accusing the bank of pursuing “a personal vendetta”.
Quinn had a reported 2007 net worth of â‚¬4.7 billion but sank much of his fortune into Anglo months before the bank suffered crippling losses as the country’s property bubble burst.
The Quinn family secretly built an up to 28 per cent stake in Anglo shares using an ill-regulated financial instrument that hid the scale of their investment from other stockholders.
As Anglo’s share price plunged, Quinn said the bank encouraged his family to borrow hundreds of millions specifically to buy more Anglo stock, a charge the bank denies.
Ireland nationalised Anglo in 2009 to prevent its collapse, wiping out a Quinn family investment estimated at â‚¬2.8 billion. The government last year renamed Anglo as the Irish Bank Resolution, or IBRC. Its bailout is expected to cost taxpayers â‚¬29 billion, a bill so great it overwhelmed Ireland’s finances and forced the government last year to negotiate a humiliating loan pact with the European Union and International Monetary Fund.
Dublin Commercial Court Justice Elizabeth Dunne told Quinn’s lawyer Gavin Simons that Quinn would have to appear in person in coming days to provide documents showing how much he is worth today.
Last week Quinn lost a Belfast legal battle to retain bankruptcy protection in the neighbouring British territory of Northern Ireland. The judge there ruled that Quinn had misled a previous Belfast court that his main base of business was in Northern Ireland, rather than the Republic of Ireland.
“I never done a day’s work from southern Ireland in my life,” Quinn, who has lived for decades in the Republic of Ireland, said last week.
Dublin-based IBRC would have faced greater difficulty pursuing Quinn for debts in Northern Ireland. Quinn also could have returned to business within a year under UK bankruptcy law, whereas the Irish law prevents bankrupts from holding company directorships for up to 12 years.
Quinn said the Irish rules meant he would be too old – aged 76 in 2024 – to direct any new companies then.
Quinn boasts one of Ireland’s most celebrated rags-to-riches stories. He grew up on a border farm in Northern Ireland, left school barely literate at 14 and started his first construction-gravel business with a £100 bank loan.
Within three decades Quinn had transformed his quarry into a nationwide cement company. He built and bought luxury hotels, pubs, apartment complexes and commercial properties throughout Ireland, Britain, Eastern Europe and Asia and founded Ireland’s third-largest insurance company.
In April 2011, IBRC seized ownership of his Irish-based Quinn Group, forced him and relatives off the board, and sold a majority stake in his insurance company to US insurance firm Liberty Mutual. In November, shortly after Quinn had secured a surprise bankruptcy-protection order in Belfast, the bank won Dublin court judgments totalling â‚¬2.16 billion against Quinn.
A November affidavit from Quinn recorded he had less than â‚¬11,000 in cash in three bank accounts. But the Quinns and IBRC are locked in several legal battles stretching from the British Virgin Islands to Cyprus over control of a property empire valued at more than â‚¬700 million.
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