Business Irish

Tuesday 14 August 2018

Retired are left to wonder - 'Where did cash go?'

Eddie Hobbs a the launch of his book 'Short Hands, Long Pockets'
Eddie Hobbs a the launch of his book 'Short Hands, Long Pockets'
Nicola Anderson

Nicola Anderson

ONCE Conor McGregor's accountant and as a former pro boxer himself, liquidator Aidan Garcia is used to rolling with the punches.

But having come out the wrong side of a playful tussle with his two young daughters, he was in agony with his back but had to make a difficult morning presentation to bruised investors informing them that their hard-earned money had vanished.

At any rate, the real fight lies ahead, as he struggles to get the information he needs to follow the money trail left behind by Brendan Investments - the €13m property fund co-founded by consumer affairs expert Eddie Hobbs.

Mr Hobbs resigned as non-executive director of the company in 2015.

"It's never nice for me to do this but I don't think…." The liquidator paused to correct himself before firming up his language: "There's not going to be anything left of the investment you put in."

The roomful of around 50 people - mostly men and women past retirement age - in the basement of a Dublin hotel greeted his statement in silence. They had not come expecting good news.

Several investors spoke at the creditors' meeting and claimed they had spoken to Mr Hobbs personally on the phone at certain stages of his involvement in his company.

Some 800 investors had been affected, said Garcia.

Financial information relating to the company is "a bit sparse" and there are "two big chunky numbers" amounting to some €4m for which he cannot find any information, he told them.

All that remains of the company's exploits is some €29,000 in cash, VAT of maybe €53,000 and a boarded-up house in the broken-down city of Detroit, USA, he told them.

Garcia hopes to sell this house but warned it is "not in a good area" and he is likely to get just €7,000 for it.

He is investigating 500 properties bought in Detroit, of which 300 were left with the Metro Group, tasked with refurbishing them. But taxes had accrued and the company took the decision that it couldn't afford to pay them and so left the houses with Metro. Some 200 of the houses were sold.

"Where did the money go?" asked one of the men.

"That's my job," declared Garcia.

Although the investors were initially suspicious, the liquidator managed to win them over with a mixture of humour and brutal honesty.

The investors told him of their reticence to invest in Detroit when informed of the decision during a company AGM. "We said no because Detroit was…." a woman trailed off.

"It was in sh*t," said Garcia bluntly in his north of England accent.

He told them it could take 18 months to investigate the company.

Afterwards, investors spoke about how their hard-earned cash had evaporated.

One man, a coach driver, had put in €20,000 of his life savings and has no other. He had wanted his children to get an education so that they could "put their thoughts into words", he said. Eddie Hobbs had these words, he added. "He encouraged everyone to invest in this company."

He had trusted Mr Hobbs, he said: "He was the big man on the telly."

Another man said they had all trusted Mr Hobbs. "He was the reason we all came on board. People trusted him. He was the consumer affairs expert," he said.

He did not want to say how much he had invested, only saying it was a "significant sum" and part of a pension investment.

One woman, a single mother, said she had put in €20,000 her mother had left her in the company after hearing the ads on the radio.

Within two years the crash came and she asked if she could take her money out but was told 'no' because it was "using the money for investments".

An elderly woman told how she ploughed €5,000 of her savings and €5,000 of her husband's into the fund.

She has not told her husband their money has gone. "I can't tell him," she said in despair.

Mr Hobbs said that he couldn't comment on any aspect of the liquidation process.

Irish Independent

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