Tuesday 12 November 2019

Criminal cases loom for disgraced Drumm in the US and at home

David Drumm and his wife Lorraine Drumm
David Drumm and his wife Lorraine Drumm
Bankruptcy trustee Kathleen Dwyer
Shane Phelan

Shane Phelan

DISGRACED banker David Drumm is facing the prospect of criminal proceedings on both sides of the Atlantic, the Irish Independent has learned.

A US bankruptcy trustee is expected to ask federal prosecutors to determine if Mr Drumm (48) should be charged with perjury after a Boston judge found he had lied under oath and fraudulently concealed asset transfers to his wife.

The move is anticipated as American justice officials continue to consider an application for the banker's extradition to Ireland to face charges linked to the collapse of Anglo Irish Bank, where he was chief executive from 2005 to 2008.

Under US law, bankruptcy trustee Kathleen Dwyer is required to refer possible crimes uncovered in the course of her investigation to the US Attorneys Office.

Lawyers representing Ms Dwyer would not comment last night.

However, observers said such referrals were quite common in the US, where a person found guilty of perjury could face up to five years in prison.

Bankruptcy judge Frank Bailey ruled on Tuesday that Mr Drumm should not be allowed to exit bankruptcy with a fresh financial start.

It means he will be held fully liable for debts of €10.5m, over €9m of which is owed to the Irish Bank Resolution Corporation (IBRC), the former Anglo.

Judge Bailey denied Mr Drumm's discharge after finding he had told "outright lies" to the court about his financial affairs and had "under oath, knowingly and fraudulently failed to disclose" asset transfers.

His judgment came seven months after Mr Drumm's bankruptcy trial, where both the trustee and IBRC had opposed his discharge.

Although Ms Dwyer (pictured inset) is now expected to refer the judge's findings to prosecutors, the Irish Independent understands that IBRC will not be taking any further action.

Instead, the bank, which is in special liquidation, will allow the trustee to proceed with the process of recovering assets for creditors.

Lorraine Drumm has already made a $1.3m (€1.1m) settlement with Ms Dwyer in relation to fraudulent asset transfers made to her by her husband.

These included sums totalling €772,000 which were transferred to Mrs Drumm in 2008 and 2009, but which were not declared by her husband when he filed for bankruptcy in October 2010.

The payments were detailed in Judge Bailey's ruling.

The trustee and IBRC had made 52 objections to Mr Drumm's discharge, 30 of which were upheld by the judge.

Separately, US authorities are considering a file seeking the extradition to Mr Drumm to Ireland.

The move came after gardai were given the green light by the Director of Public Prosecutions earlier this year to charge Mr Drumm with a number of offences.

A substantial file outlining the proposed charges was submitted to US authorities via the Department of Foreign Affairs several weeks ago.

Officials declined to comment on the process last night.

Mr Drumm has been the subject of investigation by the Garda Bureau of Fraud Investigation and the Director of Corporate Enforcement since 2009 in relation to matters at the former Anglo Irish Bank.

Efforts to persuade Mr Drumm to return to Ireland voluntarily to assist the investigation failed.

He moved to Massachusetts with his family after quitting as Anglo chief executive when the bank's fortunes went into free fall in late 2008.

The formal process of seeking Mr Drumm's extradition began in November, the Irish Independent understands.

Irish Independent

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