Friday 28 October 2016

Banker: 'My debt deal was torpedoed by Noonan's men'

Bankrupt banker believes Department of Finance pulled the plug on a possible repayment deal, writes Ronald Quinlan

Published 18/10/2015 | 02:30

Ex-Anglo CEO David Drumm
Ex-Anglo CEO David Drumm

When former Anglo Irish Bank CEO David Drumm was brought before the courts in Boston last Friday, his lawyers argued his extradition from the United States was being sought for a "political purpose".

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The Sunday Independent can today reveal the details of the debt settlement arrangement the erstwhile Anglo chief very nearly concluded with the bank's special liquidator, Kieran Wallace before the mooted deal fell through at the last minute.

Sources familiar with the negotiations have told this newspaper that Mr Drumm believes Mr Wallace was ordered by the Department of Finance to pull the plug on the agreement they had reached on the repayment of his €8.5m in Anglo director's loans.

It is understood the parties had been in negotiation in relation to the proposed arrangement for nearly eight months before it was abandoned, leaving Mr Drumm to face forensic questioning by lawyers for the IBRC special liquidator in relation to his financial affairs in Boston's bankruptcy court.

Had the settlement agreement gone ahead, the Sunday Independent understands that the IBRC would have registered a judgment against the former Anglo CEO for the full debt owed to his former employer, and by extension the Irish taxpayer.

The IBRC's special liquidators had also secured a commitment from Mr Drumm to repay his debt over the rest of his life based on a percentage of his income, on a sliding scale from 20pc to 100pc.

Interestingly, the IBRC insisted that 100pc of any income Mr Drumm might make from writing a book would go towards repaying his debt to the Irish State.

A source familiar with the matter said they believed this specific clause was proposed to discourage the former Anglo boss from "ever telling his story".

One notable provision of the proposed settlement was that it would have allowed Mr Drumm to retain one-third of his pension.

This can be explained however on the basis that the former banker required the agreement of his wife, Lorraine, to cede the other two-thirds of his retirement fund to the IBRC in repayment of his debt.

Asked for comment on the 2013 debt settlement arrangement and the reasons why it hadn't been proceeded with, a spokesman for the IBRC special liquidator declined to make any comment.

A spokesman for the Department of Finance similarly declined to comment when asked to respond to the claim that it had instructed the special liquidator to abandon its proposed deal with Mr Drumm.

Mr Drumm will spend at least the next eight days in a detention centre while awaiting a bail hearing in his extradition case in the Boston courts. Mr Drumm is being held at the Donald W Wyatt Detention Centre in Central Falls, Rhode Island. The centre is used for pre-trial detentions by US Marshals.

Sunday Independent

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