Website of solicitor who owes €26m is shut down
Monday October 22 2007
THE website of Kendar Holdings, the investment company owned by "dishonest" solicitor Michael Lynn, has been suspended.
Late last week anxious investors were reassured through the webpage www.kendarholdings.com that the company was "working closely" with overseas companies to provide assurances to all clients that their investments were secure.
But the site was suspended yesterday following a dramatic week when several banks moved to protect their loans and recover some €26.3m owed to them by the Mayo-born property developer.
Mr Lynn will re-appear before the High Court today and a fuller picture of the collapse of his property empire is expected to emerge.
Throughout the week, clients of the 39-year-old solicitor, who drew down over €26m from at least seven banks since January of this year, contacted legal advisors in Ireland and Britain to seek advice about their investments.
Some of those investors are expected to attend the High Court in Dublin this morning to serve Mr Lynn personally with summons, the opening gambit in legal proceedings against the solicitor whose practice has been shut down.
Last week it was revealed in the High Court that Mr Lynn, who failed to meet a syndicate of banks on Friday to see how his liabilities could be repaid, was using drafts drawn on clients' accounts to finance personal transactions.
Two lenders, Bank of Scotland and Anglo Irish Bank, have already appointed a joint receiver in a bid to secure their loans.
The Law Society, the governing body for solicitors which investigated Mr Lynn's practice in September following concerns about his property dealings, reported a deficit in Mr Lynn's clients accounts of €702,830, but it said it believed the actual deficit on the clients account "is much more than this".
It also said there appeared to be "free flow" of funds from the client bank account of Mr Lynn to Kendar Holdings Limited.
Mr Lynn, who has over 105 properties in Slovakia, Bulgaria, China, Spain, England, Dubai and Ireland, is alleged to have taken out multiple mortgages on several properties with several major Irish banks, with alleged loan liabilities of more than €26m.
The alleged fraud has raised questions over due diligence procedures exercised by banks
It has also triggered fears of a conveyancing crisis as the spotlight falls on solicitors who have been permitted by banks to draw down huge mortgage loans on the basis of providing a mere undertaking.
- Dearbhail McDonald Legal Affairs Correspondent
