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Thursday 21 August 2014

Solicitor jailed for defrauding bank in €9m land deal

Aoife Nic Ardghail

Published 08/04/2014 | 02:30

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John Duffy  pleaded guilty to dishonestly obtaining a loan from Investec Bank
John Duffy pleaded guilty to dishonestly obtaining a loan from Investec Bank
Tony McAuliffe pleaded guilty to dishonestly obtaining a loan
Tony McAuliffe pleaded guilty to dishonestly obtaining a loan

A STRUCK-off solicitor has been jailed for two years for his role in deceiving a bank into lending almost €9m for land now worth €30,000.

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Ex-solicitor John Duffy (44) sent false letters to Investec Bank on behalf of co-accused Tony McAuliffe (78) to get a loan for 55 acres of land in Co Offaly in 2007.

McAuliffe received a fully suspended two-and-a-half year sentence.

Judge Leonie Reynolds accepted McAuliffe had borderline intellectual functioning and deteriorating health.

McAuliffe, of Furze, Kildare, and Duffy, of Clogheen, Monas- terevin, Co Kildare, pleaded guilty at Dublin Circuit Criminal Court to dishonestly obtaining a loan from Investec Bank withthe intent of making gain in March, 2007. They have no previous convictions.

Through Duffy, McAuliffe promised the bank he had a buyer with a €7m deposit for the land. The plan was to sell the property to this buyer, a company called Conway Clarke, for €17m.

Judge Reynolds said that Investec Bank could have exposed the fraud if it had conducted background checks on the parties involved.

Detective Sergeant Pat Linehan had earlier revealed that Conway Clarke was a company set up with McAuliffe's daughter and a family friend acting as directors.

Investec agreed to fund the full land purchase price on the understanding that it was to be a "bridging loan" and would be repaid within two months. The bank was not aware Conway Clarke had been set up by the accused.

McAuliffe said he wanted €8m from the bank to buy the land which he would sell on for €17m to Conway Clarke.

Before finalising the deal, McAuliffe and Duffy handed over several documents to Investec, including a valuation of the land at €12m.

Duffy got an extension on the loan repayment date after he told an Investec representative that the deal had been delayed through illness and one of the parties being on holiday.

DECLINE

McAuliffe tried to secure buyers and put ads for the land in newspapers between May and June 2007 as the economy continued into decline.

Eventually, Investec went to the High Court after a potential purchase from a builder fell through.

Judge Reynolds accepted there had been no monetary gain for Duffy because the purchase of the land never went through.

The judge said she was also taking into consideration Duffy's personal circumstances, including the breakdown of his marriage.

She imposed a sentence of three years but suspended the final 12 months, taking into account his previous good character, co-operation and remorse.

Irish Independent

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