Friday 28 October 2016

Drumm: beaten but unbowed

The former Anglo boss has had a nomadic lifestyle since he moved with his family to the United States. Maintaining an affluent lifestyle near Boston has required all his powers of ingenuity, and his Irish downfall has come at a social cost.

Published 02/08/2015 | 02:30

On the move: David Drumm with is wife Lorraine in Cape Cod
On the move: David Drumm with is wife Lorraine in Cape Cod
Lorriane Drumm, left, kisses David Drumm as she dropped him off outside the US Bankruptcy Courthouse in May last year
20 Abington, former residendence of David Drumm in Malahide, Co Dublin
David Drumm pictured in 2005 following his appointment as Chief Executive Officer of Anglo Irish Bank with his predecessor, Sean FitzPatrick, at the company's Annual General Meeting. Photo: Robbie Reynolds
David Drumm's former Cape Cod home
The home of David Drumm, the former chief executive of Anglo Irish Bank, in 2010.
Former Anglo Irish Bank chief David Drumm arrives at the U.S. Bankruptcy Courthouse on Wednesday, May 21, 2014, in Boston.

When Anglo Irish Bank began to collapse in the spring of 2008, bringing the country's fortunes down with it, it was only natural that David Drumm would turn his attention to America, scene of some his past glories.

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The plain-speaking boss of Anglo was at home among movers and shakers in Boston, and well used to wheeling and dealing there from his early days in the the bank.

By the time it all went belly up, Drumm had bought a luxurious mansion with a swimming pool on Cape Cod overlooking Nantucket sound.

According to court bankruptcy documents, the Drumms spent $300,000 (€275,000) on "furniture, window treatments and carpets" at their new mansion in 2008.

Copying the style of Charles Haughey, he installed an Irish pub in the basement.

It was a palace befitting Ireland's highest earning banker, but back in Ireland, everything was beginning to fall apart for the golden boy of Anglo in that spring of 2008.

A few perceptive financial researchers began to notice that the bank was heavily exposed to the property market, and three days after he bought his Cape Cod bolthole, Anglo's share price collapsed. Deposits started to flee on a day that became known in financial circles as the "St Patrick's Day massacres".

Seven years on and the drama of Anglo's misfortunes has not yet reached its final act - and Drumm is facing extradition back to Ireland. His offer to appear at the Banking Inquiry this week by video link was declined, and for the foreseeable future he remains in self-imposed exile, leading a nomadic existence between Massachusetts, New York and New Jersey.

Two days after the shares plunge in 2008, Drumm transferred $200,000 from an account in Anglo to an account he held with his wife, Lorraine, in Cape Cod.

It was one of many transactions in which assets were transferred to his wife and where he built up his interests in the United States.

Drumm had already accumulated heavy debts, but there was probably no shortage of money coming in. At one stage, his total pay packet was over €3m a year at Anglo, but the clouds were darkening in Dublin.

Eventually, he was to sell up his Range Rover in Dublin for €36,000 and his BMW to his sister for €20,000. His home in Malahide was put on the market as he moved with his wife and two daughters to Massachusetts lock, stock and barrel.

In the background, David Drumm may have been keeping his options open, but for the moment in that summer and autumn of 2008, he was still boss of Anglo and outwardly he maintained a gung-ho attitude.

The Anglo boss emailed an invitation to staff inviting them to his 'Back To School Doombuster Party' in the Mansion House on September 5.

The message, which conjured up the spirit of the musicians who played on the sinking Titanic, read: "Dear colleague, The stock markets are down. They say the economy is in recession. The holidays are over. This is Anglo so there is only one thing to do - party."

And party they did, at a cost €80,000.

But in the following months, the situation for Anglo only got bleaker. The bank was nationalised and Drumm had to resign.

The 'For Sale' sign went up outside his home in Abington, Malahide and according to one account, he left very little behind. One person who viewed the house said: "He took the curtains and blinds, and even took the lightbulbs."

At first when he moved his family to the US, he moved into the mansion on Cape Cod, favourite haunt of Irish-American royalty in the shape of the Kennedys.

Chatham is a town suitable for high-flying bankers as the richest enclave on the Cape. One former local resident tells Review: "When the Drumms first arrived they lived very much under the radar."

No one really registered that a key figure in Ireland's economic troubles was living there until the local paper, the Cape Cod Times, started drawing attention to the Drumms.

On the 15th birthday of Drumm's daughter, Charlie Bird turned up, and in a comical exchange through a letter box, captured on RTÉ News, the exiled banker was heard imploring the persistent reporter to "show some respect".

The local resident says: "Once word got out and reporters started visiting his house, he put up a tall fence around the yard and a barrier across the driveway."

Since relocating to the US, David Drumm has tried to capitalise on his extensive network of contacts earned during his tenure in Boston in the late 1990s when Anglo sent him over to set up operations there.

Drumm was a spectacular success during that stint in America in the 1990s, and lived there with his wife and two daughters. Ultimately, it helped him to secure the top job in Anglo. The return to America at the height of Ireland's financial crisis was never likely to be as easy with the media and creditors on his trail.

For a time, Drumm worked for his own consultancy firm, Harborlight (later renamed Delta Corporate Finance), but that company dissolved in 2013.

During that time, Drumm was believed to be advising a Boston-based builder John McGrail, who had had dealings with Anglo in the past. McGrail specialised in buying up rundown buildings and doing them up.

The Drumms did not stay in their Cape Cod mansion for long, and it was later sold at a loss as part of bankruptcy proceedings.

The family moved to the posh town of Wellesley, 30km south of Boston, and rented a home for a short time. But when the building was sold they moved on again.

The Drumms enrolled their two daughters at Newton Country Day School. The Catholic school run by the Sacred Heart Order was last year ranked as the 10th most expensive private school in America with annual fees of $43,150 (€39,500).

According to its website, at Newton "young women are prepared for lives of courage and confidence".

The Drumms managed to muster up enough funds to buy a house in Wellesley for €2.3m through a joint trust, and Lorraine used her maiden name, Farrell, in signing the sale agreement.

According to the Drumms, they did this to maintain their privacy and avoid media intrusion.

With neatly-trimmed lawns, high privet hedges, and an average family income of nearly $190,000, Wellesley is the sort of place where a wealthy banker would not look out of place, but Drumm has found it difficult to escape his past.

The Drumms are still believed to be resident at the Wellesley home, but Drumm is virtually non-existent on the Irish-American social scene in Massachusetts. The family are thought to keep very much to themselves.

Since he arrived in the United States, Drumm admitted that his Anglo Irish woes had cost him some of the friends that he had made in Boston while working there in the late 1990s.

"I have lost friends," he said in an interview. "Boston was in some way an upsetting experience because I made great friendships there over a number of years and I kept up with them even after I moved home to Ireland; we came back every year, we had a vacation home."

Drumm reportedly now divides his time between this home in Wellesley and New York city and the New Jersey town of Carlstadt, about 13 miles from Manhattan, where he works as a consultant with a scaffolding firm, Safway Atlantic.

Michael Breslin, originally from Kells in Meath, has been heavily involved in the business, which has worked on some of the most high-profile projects in New York city, including the September 11 Memorial Museum.

Following intense scrutiny from international and Irish media on Safway's Carlstadt offices - and amid complaints from their staff about journalists door-stepping them on their way to work - it is believed that Drumm now spends more time working out of the company's offices in New York city.

The Drumm family reportedly lived for a brief time in the affluent New York suburb, Armonk, in a $1.9m mansion but moved on from there.

Both were remembered by neighbours in the area as "polite and friendly", but there was some surprise when they suddenly left their rented home.

In the past, Drumm has complained that his family "had to move state because my kids have had journalists at their school".

"They have come from Ireland and the UK and they have sat in cars outside our driveway," he told the New York-based Irish Voice. "I have had to run out of the house with my kids hiding in the backseat. I had to send one of my kids one day up the road on her bicycle to see if the media were waiting for me at the top of the street for us to come out."

Drumm has also spoken about the toll of his nomadic exile on this children and the difficulty he and his wife have experienced in trying to explain their social isolation.

Earlier this year, the judge ruling in Drumm's bankruptcy trial refused to discharge his debts and declared the Irish banker "not remotely credible", his conduct "fraudulent" and his statements peppered with "outright lies".

But despite debts in excess of €10m, Drumm has somehow managed to keep his head above water. As he faces extradition proceedings, he will require all his powers of ingenuity to maintain his American lifestyle.

Additional reporting: Caitriona Palmer

Dateline: spectacular success, exile and bankruptcy


Dubliner David Drumm is sent to the US at the age of 30 to set up operations for Anglo Irish Bank and he enjoys spectacular success.


Drumm is appointed chief executive of Anglo and takes over from Seán FitzPatrick at the height of the Celtic Tiger.


March: Drumm buys a $4.6m mansion in Cape Cod just three days before Anglo shares collapse in the 'St Patrick's Day massacres'.

September: Finance Minister Brian Lenihan introduces the bank guarantee, mainly to stop the run on Anglo Irish Bank.

December: Drumm quits as chief executive of Anglo Irish Bank.


January: Anglo Irish Bank is nationalised amid continuing financial turmoil.

June: David Drumm, his wife and two daughters move to the United States, staying initially at their home in Cape Cod before buying a house in Wellesley.


October: Drumm voluntarily files for Chapter 7 bankruptcy in Boston.


August: Anglo Irish Bank file a legal action against Drumm, claiming that he should not be entitled to a discharge from bankruptcy.


Drumm is spotted working at scaffolding firm Safway as a consultant.


Drumm's bankruptcy trial to decide whether he should be discharged from bankruptcy and given a fresh financial start gets under way.


January: Drumm is denied a write-off of more than €10m in debts after the judge found him "not remotely credible" and his conduct "both knowing and fraudulent".

July: Drumm's offer to appear at the Oireachtas Banking Inquiry by video link is declined, as the State seeks his extradition from the United States.

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