Thursday 19 April 2018

Nama to 'defend itself fully' against racketeering claims

The Treasury Building on Grand Canal Street Lower where NAMA is based
The Treasury Building on Grand Canal Street Lower where NAMA is based
Daniel McConnell

Daniel McConnell

The National Asset Management Agency (Nama) will "fully defend" itself against court allegations of committing mail and bankruptcy fraud, obstructing justice, and intimidation in a civil racketeering case in the United States.

Nama is being sued by a group of former Anglo Irish Bank borrowers, including developer John Flynn; Chicago-based Dr Joseph Sheehan; and others who are seeking damages of $12m (€8.7m).

Nama is also accused of disclosing the developers' confidential loan information to third parties for the "purpose of defrauding plaintiffs".

Claim documents relating to the case Flynn et al V Nama et al were lodged at the New York Southern District Court on December 20 and the case is likely to be heard sometime in the Spring.

A spokesman for Nama told the Sunday Independent: "It is expected it will defend the matter fully. Nama has already instructed lawyers in the United States."

The court papers filed show that Nama and other defendants are accused of continuing to demand payment of fraudulent interest charges, threatening enforcement of fraudulent personal guarantees and threatening seizures of assets and properties.

They are also accused of committing obstruction of justice, pursuing fraudulent claims against plaintiffs in the Irish courts and continuing a campaign of intimidation against plaintiffs.

Nama chief executive Brendan McDonagh is among the other defendants listed in the documents.

The civil case is being taken under the terms of the Racketeer Influenced and Corrupt Organizations Act (RICO). It is a US federal law that provides for a civil cause of action for acts performed as part of an ongoing criminal organisation.

The group of borrowers who are suing originally took out borrowings of €200m from the then Anglo Irish Bank in 1994.

They are alleging that Anglo, then the IBRC and Nama knew about deliberate overcharging on their loans and failed to act sufficiently to stop it.

They allege that the overcharging became known in 2010 and these overcharges exceeded $12m (€8.7m)

"The bank conspired with the Irish Government and related parties to cover up this corrupt activity," the documents state.

For months, Mr Flynn, Dr Sheehan and others have sought to prevent the winding up of the IBRC in a Delaware court case.

Chicago-based Dr Joseph Sheehan's Sheehan Medical Group set up the Cork Medical Centre without critical backing from the VHI.

It closed in 2011.

Developer John Flynn and his family live in Florida, and invested in the Hermitage private clinic.

Both Dr Sheehan and Mr Flynn are also shareholders in the Blackrock Clinic.

The case is being taken in the United States because the defendants have "transacted business and engaged in activity within New York and they are subject to this district's personal jurisdiction and they conduct business and own assets herein," the documents state.

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