Saturday 18 November 2017

Bankruptcy files reveal Wallace has three houses valued at €1.1m

Mr Wallace was adjudicated bankrupt after Cerberus, via its subsidiary Promontoria (Aran) Ltd, petitioned the High Court last month. Photo: Steve Humphreys
Mr Wallace was adjudicated bankrupt after Cerberus, via its subsidiary Promontoria (Aran) Ltd, petitioned the High Court last month. Photo: Steve Humphreys
Shane Phelan

Shane Phelan

Bankrupt politician Mick Wallace listed himself as the owner of three houses, with a combined value of €1.1m, in a statement of affairs submitted to the High Court.

The Independents4Change TD had told the Irish Independent his family home in Dublin was the last remaining property he owned after he was adjudicated bankrupt with debts of over €30m on Monday.

But a list of assets made publicly available yesterday also included two three-bedroom buy-to-let properties in his native Co Wexford.

Asked about the apparent discrepancy, Mr Wallace said he had lost control of both of the Wexford houses and a receiver was now trying to sell them.

"I am not sure whether they should be in the statement of affairs as they have been in receivership for about six months or so," he said.

The document submitted to the court by Mr Wallace revealed all three properties were in negative equity, with €1.36m in total owed to lender AIB.

Combined mortgage arrears on the properties amounted to over €235,000.

It said Mr Wallace had €5,300 in the bank and a pension worth almost €215,000. The value of a separate Dáil pension was said to be "unascertainable".

The document said he earned €4,000-a-month after tax, out of which around €1,000 was accounted for by reasonable living expenses and €2,000 by mortgage payments.

The only other asset listed was a 2004 BMW X5 with 434,000 kilometres on the clock, valued at €3,000.

The statement of affairs revealed Mr Wallace owed US vulture fund Cerberus €2m, AIB €9.2m and ACC €19.1m.

The TD's bankruptcy file also contained a letter written to him by insolvency practitioner James Green of McCambridge Duffy earlier this month advising he had no option but to proceed to bankruptcy.

Mr Green gave this advice after ACC refused to support Mr Wallace's efforts to come up with a personal insolvency arrangement.

Mr Wallace was adjudicated bankrupt after Cerberus, via its subsidiary Promontoria (Aran) Ltd, petitioned the High Court last month.

Two years ago the fund purchased loans his construction firm M&J Wallace had with Ulster Bank.

Mr Wallace had personally guaranteed the loans in March 2009.

When these were not repaid Cerberus obtained a judgment against him for €2m.

The file showed a court order was issued to the Dublin City Sheriff's Office last August authorising it to recover assets to satisfy the judgment.

However, the office said there were "no saleable assets" at Mr Wallace's home in Fairview, Dublin.

The TD's assets will now be managed by Official Assignee Christopher Lehane, who heads up the Insolvency Service's bankruptcy division, and he can sell off property to realise cash for creditors.

Mr Lehane also has the power to examine Mr Wallace's finances and any transactions he was involved in over the past number of years.

The TD sold a vineyard in Italy to his brother Joseph in 2009, by way of settlement of a €550,000 debt he owed him for construction materials.

He also sold a number of apartments to family members in 2008, while his company's finances were in freefall.

Mr Wallace said he expected questions from Mr Lehane, but was satisfied there was nothing improper about any of the transactions.

"To the best of my knowledge, according to the advice of my auditor, anything I have done is legal," he said.

"I'm sure the Official Assignee will go through it with a fine tooth comb and if I have questions to answer, I am sure he will ask me.

"I am in his hands now and I'm sure he will be fairly thorough.

"I think what I have done is legal. If he finds otherwise, then I will have to deal with it."

The TD added that he was hoping to keep his family home, but it was a matter for Mr Lehane and he did not know what the Official Assignee would do.

The bankruptcy adjudication comes four years after Mr Wallace's construction business made a €2.1m settlement with the Revenue Commissioners for under-payment of VAT.

At the time, Mr Wallace said he was considering putting a portion of his salary towards paying back the Revenue, but he confirmed in recent days he was not doing so as he did not have the means.

The Revenue settlement was not mentioned in the statement of affairs.

Irish Independent

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