Once Ireland’s Richest Man, Sean Quinn Declares Bankruptcy

0
Comment

January 17th, 2012

Debts Exceed $2.7 Billion

Sean Quinn, once rated Ireland’s richest person was declared bankrupt Monday as a bank pursues him for debts exceeding $2.7 billion. Quinn’s lawyers withdrew his opposition to a Republic of Ireland bankruptcy order sought by the former Anglo Irish Bank, the reckless lender at the center 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.

Rags-to-riches stories

Quinn boasts one of Ireland’s most celebrated rags-to-riches stories. He grew up on a border farm in Northern Ireland’s County Fermanagh, left school barely literate at 14 and started his first construction-gravel business with a $150 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; founded Ireland’s third-largest insurance company; and took interests in glassworks, packaging and radiators.

Net worth

Quinn had a reported 2007 net worth of $6 billion but sank much of his fortune into Anglo months before the bank suffered crippling losses as the country’s decade-long property bubble burst. The Quinn family secretly built up to a 28 percent 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 says the bank encouraged his family to borrow hundreds of millions specifically to buy more Anglo stock, a charge the bank denies.

Northern Ireland

Last week Quinn lost a Belfast legal battle to retain bankruptcy protection in the neighboring 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 have never done a day’s work from southern Ireland in my life," Quinn, who has lived for decades in the Republic of Ireland, insisted to reporters outside the Belfast court 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 U.K. bankruptcy law, whereas the Irish prevent bankrupts from holding company directorships for up to 12 years. Quinn said the tougher Irish rules meant he would be too old, 76 in the year 2024, to direct any new companies then.

Shifting ownership

The bank accuses Quinn of fraudulently shifting ownership of his foreign properties, including office blocks and shopping malls, to relatives and shell companies that remain under the Quinns’ surreptitious control. The Quinns deny these charges. His five children have filed a Dublin lawsuit against IBRC seeking to have the bulk of the family’s Anglo borrowing voided on the grounds that the bank should never have lent them the money in the first place. They also are seeking to have IBRC return businesses to their ownership that were seized in April 2011.

This entry was posted on Tuesday, January 17th, 2012 at 7:40 am and is filed under Bankruptcy, Business, Economy, Employment, Finance, Loans, Money, Personal / Internet. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

Once Ireland’s Richest Man, Sean Quinn Declares Bankruptcy

Leave a Reply