Grassroot Greens bid to block 'bad bank'
Liquidator takes control of over 50 Carroll companies
A NEW revolt from Green Party grassroots members poses a serious threat to the Government's plans to set up a 'bad bank'.
Several sections of the party's organisation have formally called for a special convention to firmly hammer out the Greens' policy on NAMA, the Irish Independent has learned.
If enough members vote against the 'bad bank', Green Party ministers and TDs will be blocked from supporting the Government's NAMA legislation, plunging the coalition into crisis.
The escalating concerns within the junior coalition party come amid claims the Supreme Court's decision to withdraw protection from Liam Carroll's companies exposed a massive risk of NAMA overpaying for the loans and properties it takes over.
The provisional liquidator who took over parts of Mr Carroll's Zoe group yesterday has been granted extensive powers by the High Court.
Appointed at the request of ACC Bank, he has been granted powers to take control of some 51 companies loosely known as Zoe Developments.
In addition to taking over all subsidiaries of Vantive Holdings and Morston Investments Limited -- the holding companies that distributed loans across the Zoe group -- the provisional liquidator has been granted powers to fire staff and appoint additional directors to the boards of those companies.
The High Court yesterday heard that even though ACC is owed only €63.9m by Vantive, that company is exposed to total debts of €569m.
The fear is that if a court liquidator is formally appointed following a full hearing of the winding up application next month, a liquidator might -- in order to secure ACC's money -- be obliged to conduct "fire sales" worth several hundred millions of euro.
Banks owed €1.2bn are not expected to immediately appoint receivers to Carroll's companies following a crisis meeting yesterday.
It is understood that while the banks owed money have receivers on standby, they agreed not to move against the group until a full hearing of the application of the liquidator is heard on September 9.
Finance Minister Brian Lenihan's officials insist the Carroll judgment will not affect NAMA.
But some senior Green Party activists are worried about the country being saddled with a debt of €50bn in bad property assets and want the legislation changed.
Under party rules, five constituency organisations can call a convention and already four have passed such a motion -- Waterford; Dublin Central; Dublin South-Central; and Dublin South-West.
At a convention, party sources say a motion would be put forward demanding the TDs not vote for NAMA in the Dail.
If two-thirds of the membership were to oppose NAMA, the TDs would be under orders not to vote for it, casting serious doubt on the possibility of passing the bill.
"The aim of the convention is to alter NAMA, to stop it in its tracks. There are a large number of moderate Greens involved in this process because we think the party leadership has got it wrong," a party source told the Irish Independent.
"The taxpayer will take the risk and foot the bill. It is the single biggest political issue of our time."
Among those calling for the special convention to be held on the issue are local election candidates: James Nix in Limerick City; Gary Fitzgerald in Dublin Central; Arthur Doohan in Dublin South-West; and former councillor Tony McDermott in Dublin South-Central.
But party headquarters are claiming the motion passed in Dublin South-West is not valid, leading to accusations it is "hiding behind the rulebook".
Those calling for a convention believe "there won't be a problem" getting five constituency organisations to demand a convention be held before the Dail votes on NAMA.
The Green Party confirmed three motions were received by party headquarters and there was a query on a fourth.
A party spokesperson said it would not be commenting on whether a convention was needed on NAMA.