Tuesday 21 May 2019

A property empire built on sand

Three months ago, Michael Lynn moved in a world of private jets and fabulous wealth. Now a global manhunt is set to get under way as the solicitor turns fugitive

Laura Noonan

Less than three months ago, Michael Lynn's top team was cruising around Europe on a private jet.

Bolstered by the addition of some fresh talent, Lynn & Co were on the hunt for potential property coups to enrichen an already thriving Kendar Holdings.

As one former executive recalls, "it was kicking into gear very nicely and we had some fantastic projects going".

The difference a few months can make came sharply into focus for Lynn's former comrades last night, as they reeled in horror from the news that their one-time leader had fled, leaving behind him a property empire in disarray.

A handful of executives stand bewildered, wondering how they saw none of this coming, and they insist they truly didn't.

Twenty-odd Dublin employees say they have simply been abandoned, with no final month's pay and no P45s or P60s.

Investors are scrambling to ensure their money doesn't go up in smoke with the rest of Lynn's legacy.

And foreign Kendar offices are desperately trying to keep investors' confidences -- and their own heads -- above water.

Anger

Anger was the chief sentiment expressed by Lynn's former associates and employees yesterday, followed swiftly by disbelief.

Much of this anger is targeted at Lynn's failure to pay his Dublin staff. The workers were given their notice in September and told to finish up at the end of October.

Salaries for September were paid, salaries for October were not.

Lynn previously told this newspaper that he was unable to pay his staff because the Law Society had frozen his assets. Speaking in early November, Lynn added that he planned to pay the employees as soon as he could.

"He seemed genuinely concerned about the staff, and he seemed very irritated that the accounts had been frozen," says one person who spoke with Lynn at the time.

A month later, however, not a penny has been paid and many staff have been left in employment limbo without P45s or P60s.

A text message from this newspaper to Lynn about employee payments sent on Tuesday received no reply.

"There was talk of money coming from Hungary or from Portugal [where there are Kendar developments], but it never came," says one.

"At the end of October the place was effectively abandoned and the employees were abandoned too," recalls another, who is still substantially out of pocket.

"There were some people who were left very badly-off financially, people who have young children and big mortgages.

"We have effectively no way of getting hold of the company. We tried contacting solicitors but he's changed solicitors so many times we can't keep up."

Some employees have taken matters to the Department of Employment, others have contacted the Revenue Commissioners in a bid to extract themselves from their enforced limbo.

But they say payments and tax forms are only half the battle.

"People who are out there trying, looking for work, are being turned down because of Kendar," says a source.

"Kendar became a dirty word overnight. It wasn't fair at all, everybody in there was doing a good job and trying to make it work but now we're all tarred with everything that went wrong."

Meanwhile, others are still grappling in disbelief at how a property empire that once looked so promising could have gone so wrong.

For years, Lynn was Mayo's golden boy blazing an acquisitive trail through Bulgaria, Portugal and Romania, to name but a few hotspots.

"We'd asked him about financing sometimes, but there was never any inkling that there was a problem on that end," recalls one insider.

"We had the idea that Michael Lynn was a very wealthy man and was bankrolling the thing."

Lynn was bankrolling things, of course, but only by taking multiple mortgages out on single properties to keep the cash flowing.

"We knew nothing about any of it at the time, but the feeling I get now is that he was stupid enough to think it was all going to work out," says one bemused ex-Kendar employee.

Greedy

"It made sense to raise money from banks at the lowest rate possible, but then he got greedy by reinvesting it in different places rather than paying it back."

Just this summer, Lynn had taken on a handful of key staff to put some order on Kendar's frenetic expansion and help propel the company to the next level.

Their focus was largely on sales and operations channels, as the company's overall financial structure was a secret closely guarded by Lynn.

That structure will come in for sustained probing in the coming days, as lawyers try to gauge what's left and what can be appropriated to Irish creditors.

Despite having its headquarters in Dublin, the Irish-registered Kendar Global Holdings had assets of just over €200,000 and was worth just over €1m at the end of 2005 (the last year for which accounts were filed).

The assets of the Irish companies have been frozen, their auditor has resigned, and Lynn's one time right-hand man (and brother-in-law through marriage) Cathal Power has moved to distance himself from the businesses.

Insiders say most of Lynn's developments were financed by purposely founded companies which managed their own accounts and reported to Kendar Global operationally. It is these foreign-registered companies which hold the key to most of Lynn's assets, they say.

In recent months, Kendar newcomer Anthony Cantwell has been assuming control of the foreign branches and moving to secure investors money. Several overseas Kendar branches are still up-and- running, despite the Lynn debacle, as their accounts were not frozen by the Law Society's initial order.

Over in Hungary, developments are progressing, as are projects in Portugal and Bulgaria.

For investors, staying with Kendar might seem a white-knuckle ride, but bailing out now could prove even more unpalatable.

"If people keep their money where they have it, the stuff that's committed to will probably be built and it'll turn out fine," says one source. "But if people panic and take their money out then those offices could go down, too, and the developments with them."

As the dust on Lynn's disappearing act settles, thoughts will inevitably switch to the next step in the saga.

That development largely depends on if and how he resurfaces, but those who were once close to him are sure there's plenty of mileage left in the story yet.

"He built this thing up from the ground and he loved it," said one. "One thing's for sure, the Michael I know isn't going to give this up easily."

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