Tuesday 28 February 2017

Drumm launches appeal on US bankruptcy ruling

Shane Phelan

Shane Phelan

David Drumm leaving the Courts of Criminal Justice in March after he was bailed. Photo: Mark Condren
David Drumm leaving the Courts of Criminal Justice in March after he was bailed. Photo: Mark Condren

Former Anglo Irish Bank boss David Drumm has issued a strongly worded appeal against a US bankruptcy court ruling denying him protection from his creditors.

Mr Drumm (49), who is currently awaiting two trials in Ireland, claimed the Boston court made findings which were "illogical" and "implausible".

The comments were made in a legal filing as part of the Dubliner's appeal against a decision to deny him protection.

Without such protection, he remains open to lawsuits for the recovery of his debts of over €10m.

Mr Drumm is representing himself in the appeal, having asked his US legal team to step down.

He made a 56-page submission to the US Court of Appeals for the First Circuit yesterday.

It is the second time he has appealed a decision by a Boston bankruptcy court to refuse him protection.

A previous appeal to the US District Court was rejected.

In the document, Mr Drumm listed 18 issues he wants the appeals court to consider.

These include his belief that the bankruptcy court judge and the district court judge made a series of errors in their conclusions.

He claimed the bankruptcy court was wrong to determine he was not entitled to a discharge, that he had provided an inaccurate account to the court and that he transferred property before the bankruptcy to hinder, delay or defraud creditors.

Errors

Mr Drumm also claimed the district court made errors by concluding he was "a sophisticated debtor" who was fully capable of accurately completing a statement of financial affairs.

He claimed many of the key findings on which the bankruptcy court based its decision were "inconsistent", "contrary to the evidence" and "clearly erroneous".

Mr Drumm has maintained details of asset transfers to his wife were left out of a statement of financial affairs on the advice of the bankruptcy legal team representing him at the time.

Lawyer Stewart Grossman admitted during Mr Drumm's bankruptcy trial that his firm had "goofed" by not including the transfers in the document.

In his filing to the appeals court, Mr Drumm said it was undisputed he had "disclosed everything" to his advisers "and they took responsibility for the mistakes under oath".

The former Anglo boss said it was "equally unfair" that he was held to a higher standard than the experts he hired to advise him in relation to his bankruptcy.

He said he was a trained accountant and an experienced real estate lender, but not a bankruptcy expert.

Mr Drumm said the bankruptcy court's findings against him were "illogical, implausible" and "without support in the record".

He said it was clear he had made full disclosures to his attorneys and the forensic accountants they hired, and had relied on their advice.

The bankruptcy appeal is taking place as Mr Drumm prepares for two criminal trials in Ireland.

The first trial is scheduled to begin in April of next year and will deal with two charges of conspiracy to defraud and false accounting relating to €7.2bn in deposits placed in Anglo accounts by the then Irish Life and Permanent in 2008.

The second trial, on 31 other charges mainly relating to the so-called Maple 10 share support scheme, is set to get underway in January 2018.

Irish Independent

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