Fingleton moved €500,000 offshore in wake of debt order
Exclusive: Cash was moved following debt order
DISGRACED former Irish Nationwide chief executive Michael Fingleton transferred €500,000 – half of his cash savings – to an offshore bank account just days after he was hit with a €13.6m debt order by Ulster Bank.
Mr Fingleton moved the €500,000 to an account in his name at the Atlas Mont Bank in Podgorica, Montenegro, in November 2010. This account was emptied weeks later, on January 21, 2011, when Mr Fingleton transferred €480,000 to the London Barclay’s Bank account of his son, Michael Fingleton Jnr.
On the same day, Mr Fingleton transferred another €128,498 from a separate account in Montenegro to his son’s London bank account. This second tranche of money was transferred out of New Fjord Developments (NFD), a company founded in 2006 by Mr Fingleton and Irish developer Louis Maguire to turn a dilapidated hotel in the former Eastern European country into a lavish resort.
The movement of the €608,498 to Mr Fingleton's son was uncovered by inspectors from Montenegro's Authority for the Prevention of Money Laundering and Terrorist Financing (AML) during a routine inspection after NFD was forced into bankruptcy by its creditors last year.
Mr Fingleton has been at the centre of controversy over his €27m pension pot and his refusal to hand back a €1m bonus paid to him by Irish Nationwide.
Mr Fingleton ploughed €5.5m of his own personal funds into the planned €95m development of the landmark Hotel Kotor Fjord in 2006.
But the accounts of the company behind the ill-fated project have now been frozen.
Before he transferred the massive cash sums to his son, the former building society boss -- who earned a €2.4m-a-year salary before his retirement in April 2009 -- claimed in a letter to Ulster Bank that he had cash deposits of just €1m.
The AML investigation of NFD's company accounts took place on December 23 when the AML -- the equivalent of Ireland's Garda Bureau of Fraud Investigation -- discovered the cash movements and raised questions about the transfers.
The report, which has been seen by the Irish Independent, reveals that on November 5, 2010, €500,000 was transferred from Ireland into Mr Fingleton's private account in Podgorica.
This was just four days after Mr Justice Peter Kelly ordered Mr Fingleton to repay €13.6m to Ulster Bank, on foot of a failed land deal in Co Cavan, following a case at the Commercial Court in Dublin.
Seven months earlier, Mr Fingleton had provided a statement of affairs to Ulster Bank in which he claimed his prime asset was the Hotel Kotor Fjord, valued at €4m.
The purpose of the €500,000 transfer was described as "foreign investment", but the inspectors say in their report that it has not been confirmed that Mr Fingleton in a personal -- as opposed to a corporate -- capacity has invested in property in Montenegro.
The inspectors have queried the €128, 498 transfer from the NFD company accounts to Michael Fingleton Jnr's Barclays account, stating that it was "without a clear basis".
The inspectors say his son does not have a "commercial relationship" with NFD.
Late last night, Mr Fingleton sent a text message in response to queries by the Irish Independent. The following are extracts from it:
" ... I am unable to comment on matters before the Courts in Montenegro.
"You will simply compound the enormous Libel already perpretated which my Lawyers advise me is the most blatent they have ever encountered.
"I would respectivly advise you to await the outcome of the case. When the case is finalised I and my Lawyers will have a lot to say."
Earlier in the day, Mr Fingleton would not comment on the inspectors' report when contacted by the Irish Independent.
In addition, repeated efforts to contact both father and son through Mr Fingleton's Belgrade lawyers also proved unsuccessful.
But in objections filed in Podgorica in response to the inspectors' report, Mr Fingleton said that he and his son Michael Jnr were not the subject of any official investigation on their private accounts.
Last night Mr Maguire, who was removed as an authorised signatory on the New Fjord account in November 2008, said he had no knowledge of the €128,498 transfer until the AML inspectors looked at its accounts. Mr Maguire said he was co-operating with the authorities in Montenegro and would continue to do so.