Empire of greed comes tumbling to the ground
The Law Society was asked if it applied to have Lynn's passport seized. But the chances of success were slim, says Maeve Sheehan
THE hunt for the fugitive solicitor, Michael Lynn, intensified this weekend as banks joined forces to hire an international financial investigator to try to track down what is left of the €80 million he owes them.
Banks and building societies agreed the dramatic move at a meeting last Thursday night after it became clear that the 39-year-old solicitor had gone on the run rather than face questioning by the Law Society over the biggest financial scam in the history of the state.
A banking source confirmed that a number of institutions agreed at the meeting to "come together" to fund a financial investigation to follow the money trail as he built up his international property empire on bogus borrowings. Financial investigators will search for bank accounts, properties and any other assets which Lynn might have concealed abroad.
At least 11 financial institutions were duped into giving loans of €80 million to Lynn, who drew down multiple mortgages on properties, some of which he did not even own. Since his scam was exposed by a whistleblower in October, he is under investigation by the Garda Fraud Squad while financial institutions have raced to the courts to recoup their money, seeking orders to force him to identify and liquidate his assets.
Last week, it emerged that he has assets worth €52 million in at least 10 different countries, leaving almost €30 million to be accounted for. He controlled 154 bank accounts in countries as far flung as the US, Liechenstein and Eastern Europe, some of which were already been cleaned out. There may be other bank accounts too.
Hopes of finding them dwindled further last Thursday when it became clear that Lynn had gone on the run to evade his much anticipated appearance before the president of the High Court, Richard Johnson, last Wednesday.
He was to be cross examined over two days by the Law Society on six dubious property transactions, including how he came to secure loans worth €12 million from at least three banks in April to buy his trophy home in Howth, Glenlion, that cost him €5 million.
An order that gardai arrest him and bring him before the High Court should he turn up in Ireland remains in force. That prospect appeared increasingly unlikely, however. As long as he stays away, Lynn cannot be arrested as the civil court order has no power outside Ireland.
The only other way of forcing him to come back is to extradite him to face criminal charges here.
According to sources, gardai are a long way off recommending charges.
Garda sources said the fraud squad inquiry will be lengthy, as detectives had only planned to question Lynn at the end of their investigation, after they had spoken to the financial institutions, staff and employees.
Lynn's details have been circulated to garda stations around the country and it is understood that detectives will examine his mobile phone records.
Detectives may also want to know if Mr Lynn has got in touch with his beleaguered wife, Brid Murphy, who along with banks, clients and investors is now left trying to unravel the enormous web of property transactions he spun across the globe.
There were growing suspicions that Michael Lynn may have been planning his escape for weeks. The Law Society's questioning of Mr Lynn -- his first public grilling -- would undoubtedly have proved uncomfortable for him, even though he was told that nothing he said could be used in criminal proceedings against him.
Last Monday, it emerged in the High Court that a computer server with vital information on his international property portfolio had gone missing. The computer server, which had been in his office, had information on it relating to Kendar Holdings and may have been removed from a locked room. The locks had been changed and Mr Lynn had access to the room from a car park.
Mr Lynn was also trying to stall for time. He wasn't in court last Monday but his barrister asked the High Court for an adjournment on the basis that he was changing his solicitors -- for the third time. He was replacing his existing firm, P J Walsh & Company, with a London firm, Merriman White, and needed to consult with them.
His wife, Brid, said she last saw him that Monday evening in London.
Her barrister later told the High Court that she had accompanied him to the meeting with Merriman White that day. She flew back to Dublin on Monday evening and, according to her legal team, last spoke to her husband on Tuesday, the day before he was due in court. Her barrister told the court that Lynn had not returned his wife's calls but that she hoped to hear from him soon.
Dublin firm Matheson Ormsby Prentice, which is acting for a receiver appointed by one of the banks, clearly had suspicions. It asked the Law Society several weeks ago if it planned to apply to seize his passport. The thought had occurred to those in the Law Society too, but the chances of succeeding were slim to zero. What judge would have curtailed Lynn's freedom, given that he was -- ostensibly at least -- co-operating with the courts and was not charged with any criminal offence, one source asked.
Taking flight is not out of character. When Lynn's reckless borrowings were first exposed in October, after a former employee reported him to the Law Society, Lynn at first co-operated with their inquiries but then went abroad.
He is believed to have been in Portugal, where his company Kendar Holdings was developing an apartment complex. His disappearance prompted speculation that he had done a runner but it is believed he was persuaded by friends to return to Ireland and face the music.
The Mayo-born solicitor has been building his property empire since 2003 when he set up his company, Kendar Holdings. He was 10 years out of Trinity College, where he studied law and had his own legal practice in Blanchardstown. The lure of profits to be made in property were too attractive.
He personally owned and sold on more than 25 properties during the height of the property boom between 1997 and 2007, including a house in Balbriggan and five cottages in Blanchardstown. He had far more grandiose ambitions for his overseas property portfolio. The plan was simple.
He would develop apartment complexes and fund them with booking deposits from investors. That was fine in the boom years but as the good times waned, the booking deposits dried up and Lynn was left with skeleton developments starved of cash.
Last year, his borrowings accelerated, as he he used his position as a solicitor to double mortgage properties, using the money to prop up his crumbling investments abroad.
This year alone, he borrowed €26 million. The bubble burst when a solicitor in his office, Fiona McAleenan, was told to mind her own business when she inquired about conveyancing transaction.
She resigned and went straight to the Law Society and Michael Lynn's house of cards came tumbling down.
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- Maeve Sheehan
