Seizures of criminal assets hit by huge slump in property values
Published 10/01/2010 | 05:00
Plunging property prices have had a dramatic downward impact on the fortunes of the Criminal Assets Bureau (Cab).
According to the latest annual report of the bureau, criminals have invested much of the proceeds of organised crime in property. Some properties may have lost their entire value, while others have been sharply reduced during the slump.
The consequence is that Cab's property portfolio has tanked.
Cab frequently seizes properties from convicted criminals or puts their operations into receivership.
Where the bureau has managed to secure receiverships from the courts, diving property prices are forcing consequent downward revisions in valuations. Currently the book values of properties held in receivership by Cab stand at around €20m -- but this is no longer a realistic figure.
By far the best known cases in this category were the flashy properties inhabited by the wife and son of convicted drug baron John Gilligan.
As properties in receivership cannot be sold for seven years, these assets have been steadily declining from their peak levels reached in early 2007. Many of them are now in negative equity as they are subject to outstanding mortgages, rendering some of the bureau's assets less than worthless.
According to their annual report, Cab noted a significant downturn not only in the value of properties in its portfolio but also in motor vehicles subject to its orders.
It determined to consult with the Department of Finance to consider other ways of disposing of these assets that might be of more benefit to the state.
The annual report reveals that 25 Proceeds of Crime cases were brought before the High Court, the majority being against drug traffickers, fuel smugglers or money launderers. The total amount delivered to the Exchequer as a result of Cab's activities exceeded €12m.