TD not personally liable for settlement
TAX cheat TD Mick Wallace is unlikely to face prosecution and will not be made personally liable for the €2.1m settlement his now-bust construction company, M&J Wallace Ltd, has made with the Revenue.
This is despite the fact that the colourful TD made false declarations on that company's VAT returns.
The only assets that can be used to try and clear the debts of M&J Wallace are that of the company, and Mr Wallace's personal assets are not at risk.
This is because M&J Wallace Ltd is a limited liability company. In contrast, had Mr Wallace operated as a sole trader or in a partnership, creditors including the Revenue could pursue him for his personal assets.
Protecting personal assets and placing a ceiling on losses are the chief advantages of a limited liability company.
In certain circumstances, the courts can "pierce the corporate veil" and hold directors personally liable for the debts of a company.
But in this case, the Revenue regards his tax wheeze as "careless" rather than "deliberate", according to Mr Wallace.
This means he is unlikely to face prosecution because the announcement of a Revenue settlement usually marks the closure of a matter.
It is also unlikely that he will face criminal prosecution. Gardai said that they had no role in the affair and had not been contacted by the Revenue.
But Mr Wallace may not be out of the woods yet. He could yet lose his job as a TD if ACC Bank, which secured a €19.4m judgment against M&J Wallace Ltd, moves to bankrupt him.
It is important to note that these debts were personally guaranteed by Mr Wallace.
Mr Wallace narrowly avoided jail earlier this year when it emerged that his company had failed to pay staff contributions into their pension fund.
As well as the company, Mr Wallace was prosecuted by the Pensions Board in his personal capacity as a director. Judge John Paul McDonald imposed a fine of €7,000 on Mr Wallace.