Surprise as Dunne tries to drop US bankruptcy bid
Published 22/08/2014 | 02:30
BUST developer Sean Dunne is seeking to withdraw his application for bankruptcy protection in the US.
The dramatic and unexpected development came as the businessman claimed he no longer had the resources to fight efforts by NAMA to stop him emerging from the process debt free.
Last year Dunne filed for bankruptcy in Connecticut, where he has lived since 2010, as creditors owed a total of €695m began to circle.
However, Ulster Bank later moved to make Dunne bankrupt in Ireland and an unprecedented dual bankruptcy process has been taking place ever since.
But he now wants his US bankruptcy case dismissed, claiming that even if he wins his creditors could seek to "undermine the discharge" because of the Irish case.
Dunne's move came after NAMA, which is pursuing loans of €185m, considerably ramped up its investigation of his affairs in recent months.
The agency has made a series of damaging allegations about the conduct of the one time 'Baron of Ballsbridge', claiming he has failed to provide it with details of bank accounts, emails, and other key information he is required to disclose.
The toxic loans agency alleges Dunne transferred millions of euro to his wife, socialite turned property developer Gayle Killilea, in the years before going bust, putting assets beyond the reach of creditors.
It also claims he "knowingly and fraudulently" gave misleading information when filing for bankruptcy and during creditor meetings.
The accusations have been denied by Dunne, who has accused NAMA of going on a fishing expedition. However, if they were proven during Dunne's forthcoming US bankruptcy trial, the businessman could face charges of perjury - a crime carrying a jail term of up to five years.
A court in Connecticut will now have to decide whether to dismiss the case. It is not yet clear whether NAMA or other creditors will press for the trial to go ahead or be satisfied with an Irish bankruptcy.
In a court filing seen by the Irish Independent, Dunne's lawyer James Berman said his client did "not have the resources" to defend NAMA's objection to him walking away debt free.
He also said Dunne "cannot be assured" there would be no efforts "in Ireland or by Irish creditors to undermine the discharge as a result of the Irish bankruptcy proceeding".
Mr Berman said Dunne "would incur expenses he cannot afford for a victory that would provide uncertain benefit or, indeed, no benefit at all" if he was to push ahead with his bid for bankruptcy protection in the US.
Separately, NAMA and Ms Killilea are to seek the appointment of a "neutral third party" to decide what information she is required to provide the agency about her financial dealings.
Although Ms Killilea is not a NAMA debtor, the agency wants her to surrender financial information about her property development activities in the US.
Ms Killilea is unwilling to divulge information which does not relate directly to her husband, who has been acting as her employee.
NAMA claims that because Ms Killilea, a former newspaper gossip columnist, received considerable sums of money from Dunne between 2005 and 2008 that virtually all of her ongoing business "constitute assets and activities" of her husband's estate.
Ms Killilea has been involved in several multi-million euro property deals in New York and Connecticut in recent years.
Meanwhile, Bank of Scotland was last night granted permission by a US court to seize control of Ouragh, Dunne's €4m home on Dublin's Shrewsbury Road.