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Monday 22 September 2014

State gets just €2m of €110m owed by former Anglo chief FitzPatrick

Dearbhail McDonald and Paul Melia

Published 01/07/2014 | 02:30

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Sean FitzPatrick
Sean FitzPatrick
Sean FitzPatrick

FORMER Anglo Irish Bank chairman Sean FitzPatrick is free from bankruptcy.

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But after four years, the State has recovered less than €2m.

He owed €110m to the nationalised Anglo Irish Bank when he was made bankrupt.

Mr FitzPatrick is now free to borrow money, become a company director once again and acquire new assets free from the reach of banks and other creditors.

The former banker, who is facing a legal bill of up to €1m – even though he was acquitted of all charges in the recent Anglo trial – had offered his creditors €8m through a proposed scheme of arrangement.

The €8m proposal was backed by friends and relatives who offered financial support to avoid Mr FitzPatrick being made bankrupt.

But IBRC turned down the scheme, which included an offer for full security over Mr FitzPatrick's stake in an oil project in Nigeria.

The rejection of the scheme resulted in Mr FitzPatrick entering bankruptcy, raising questions at the time whether the bankruptcy of the high-profile banker would subdue public anger at the expense of recovering money for taxpayers who bailed out Ireland's banks.

Mr FitzPatrick complained that Anglo had decided to proceed against him, even at the expense of its ability to maximise its potential to recover its borrowings.

He said he believed the bank's policy was being driven by public perception that its former executives should not be let off the hook – a claim rejected by Anglo, which is now in Special Liquidation.

Only €1.6m has been paid out of the estate of Mr FitzPatrick, who formally emerged from bankruptcy on June 3 last. The interim payment was made to the Revenue Commissioners, who are a preferential creditor in bankruptcy actions.

Dividend

Last night, the Insolvency Service of Ireland (ISI) confirmed that the €1.6m preferential dividend – published in Iris Oifigiuil – was the only payout so far.

"This is the only dividend paid to date in the estate," said a spokesperson on behalf of Official Assignee Christopher Lehane. Last March Mr FitzPatrick, of Greystones, Co Wicklow, was acquitted of 16 counts of providing illegal loans to the family of businessman Sean Quinn and the Maple 10 group of investors.

He was found not guilty by the jury of providing unlawful financial assistance to the Maple 10 and was acquitted by direction of trial judge Martin Nolan of giving illegal loans to the Quinns due to lack of evidence.

Insurers refused to cover the legal costs of Mr FitzPatrick, then an undischarged bankrupt who did not seek legal aid. Mr FitzPatrick's defence was privately funded after he was refused directors and officers' liability (D&O) cover.

But following his acquittal, he applied for his legal costs, estimated at up to €1m.

The State challenged the costs application on the grounds that the prosecution was in "the public interest".

The DPP also objected to the application, saying that it was not clear how Mr FitzPatrick met his own legal costs.

Mr FitzPatrick was adjudicated a bankrupt almost four years ago with debts of €145m and assets worth less than €47m.

At the time of the adjudication, he would have expected to remain a bankrupt for a period of up to 12 years. But under new insolvency laws introduced last December, the duration of bankruptcy has been reduced to three years.

Irish Independent

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