The battles of Philip Marley

On Saturday, April 13th, 2013, Philip Marley texted his former business partner Bill Nixon a single word: "Family."

The text from the north Dublin businessman, who during the Celtic Tiger had become a millionaire after listing his property company Ely on the London stock exchange, was a strange one to send to a former business partner. Nixon was by then used to it.

In the months beforehand Marley had taken to emailing the managing partner of Maven Capital Partners long, angry emails.

At one point the Dubliner sent the private equity chief a photograph of himself, staring into the camera. The subject line was “Waiting.”

Nixon told The Irish Times: "It was bizarre and I construed it as an attempt to threaten me. I represent 13,000 investors and have done many deals over 30 years but I have never dealt with anyone even approaching Philip Marley."

Marley first met Maven, which manages £300 million for pension funds and business people, in early 2011. He was introduced to the firm by a financial adviser, and, on the face of it, he had a simple proposition.

Marley wanted Maven to help him buyout student management contracts for hundreds of apartments in eight different developments in Britain and Ireland formerly run by his old company Ely. The Dublin businessman appeared dynamic and with a decent record in the property game behind him.

Marley and Maven formed a joint venture called Space Student Living Ltd to collect rents and manage the apartments. To get things going required capital.

Maven put up £2.7 million. About £600,000 of this was ring-fenced in a special account but the rest was to be used by the company. Marley put up £800,000 which Maven believed would be in cash but turned out to be a bond with a face value of £800,000.

Marley was enthusiastic. He told Maven once they had things bedded down he would built a global student accommodation empire.

For 18 months Marley was always close to doing new deals but none arrived. Refurbishment costs associated with the existing apartments, he said, were taking up his time.

Gradually Nixon’s patience wore down. No money was coming in to Maven – even though he knew Space was collecting large sums in rents from students.

In July 2012 Nixon asked Marley to meet him for lunch to explain. Marley arrived in a chauffeur-driven Jaguar.

Highly animated
"We had a very short lunch," Nixon recalled. "He told me he faced a number of difficulties. He was highly animated. I told him I wanted to see where our money was right away and exactly how it was being spent. No more excuses."

Marley reassured Nixon everything was in hand, but trouble was close.

At the start of August, Space lost control of two of its best assets.

National Westminster Bank appointed a receiver to two student accommodation blocks in London and Kent called Bower Terrace Student Accommodation and Herbal Hill Studios for non-payment of its debts.

This was news to Maven. Marley hadn’t informed it things were so bad and the bank was not being paid.

Marley came out fighting. He said he would "vigorously" fight his banks and said Space was still on course, he said, to conquer America, the Netherlands and Scandinavia.

Nixon lost his patience. He demanded an explanation from Marley. “Philip Marley then resigned saying he couldn’t do it anymore,” Nixon recalled.

Maven ordered its accountants to trawl through Space’s books. It was horrified by what it found. Marley’s dream of launching Space into the stratosphere was about to die. Maven moved immediately to recover its investors’ money and began legal action against Marley seeking £2 million.

When Maven looked at where the rent collected from Space went it found to its surprise that much of it was going back to Ely in Dublin.

Marley said some of this money was used to revamp apartment blocks but Maven questioned where €250,000 Marley said was paid out on interiors had actually been spent. In four days not long before Marley had resigned, a large sum of money was transferred out of Space on Marley’s instruction without the knowledge of Space’s board.

Marley denied any impropriety. “They took my company off me and ruined it. Now they are looking for someone to blame,” he said.

A run through Marley's credit card showed a bill for $6,000 in Las Vegas, a stack of receipts for tanning salons and £7,000 spent for an unknown purpose in a Mayfair pharmacy in London.

Marley refused to comment on rumours he spent company money buying human growth hormone. He said he needed sun beds to treat a skin condition.

“”I am never going to apologise for medical spending on looking good or on my entertainment budget. That’s how I roll,” he said. “Any medicine I took was to improve my appearance. Vanity is important for a CEO,” he said.

Marley claimed the Las Vegas bill was part of an “investor road show”. Maven, his fellow shareholder in Space, did not know about this.

Originally Marley put £800,000 into Space but when Maven went looking for this money, it found it was an £800,000 bond issued in Costa Rica.

Nixon has said the bond is “worthless,” and Marley “misrepresented” his investment. Marley denies this.

As Space was falling apart around him, Marley was exploring new opportunities.

In May 2012 Philip Marley met Dana Wilkey, a celebrity in America after she appeared on the reality TV show The Real Housewives of Beverley Hills, in London.

Wilkey had split up two months earlier from her fiancé John Flynn, a businessman. She hit it off with Marley.

Marley went home to his wife and children and said America was the future.

In June 2012 he flew to New York and then on to Los Angeles, where he met Wilkey to discuss creating a reality TV show which was to be called Rich 'n' Ditched.

On July 15th, a photo-shoot that saw Wilkey draped across Marley's lap appeared in the Sunday Independent. The newspaper had contacted Marley after Wilkey tweeted to her tens of thousands of followers that he was "earth shattering", adding "Am I dreaming?"

Marley described Wilkey as an “amazing character”. A relationship developed and Marley left his family home to develop new business ideas with Wilkey.

"I'm starting over again and not without the shadows of the past," Marley told the Sunday Independent. "But I'm not afraid to stand up and say I'm going for it again. We're entitled to recycle ourselves. I'm not going to hold back on saying that out of fear. Because when you are afraid you are finished and a man should never be afraid."

Liquidation
Marley's mounting list of creditors did not agree. On February 26th, 2013, Ely Property Group was placed into liquidation at the request of the company's former auditors Copsey Murray Chartered Accountants.

It had become concerned when a subsidiary of the group Ely Properties Ltd filed a set of accounts for the new year to the end of December 2010 using new auditors described in its accounts as "independent auditors".

This new "auditor" was a company called Shrewsbury Accounting whose directors were Marley and Wilkey.

Copsey Murray made a complaint about the matter to the Office of the Director of Corporate Enforcement as it alleged the accounts had been filed with the Companies Office wrongly.

Marley dismissed the matter in January 2013 as a “simple error. It is a storm in a teacup.” Copsey Murray did not agree and placed EPG into liquidation over an unpaid bill.

Collins Garcia was appointed as liquidator first to EPG, and later to EPL. In an affidavit in the High Court, it said it found Ely kept little paperwork.

Marley told The Irish Times Ely had run a "paperless" office.

The Ely accounts showed payments being made to Marley personally; Ad Will, a company owned by Wilkey; and various companies controlled by Marley.

The task for Marley’s creditors was to find out where their money had gone too. Marley said everything was above board but not all believed him.

Marley’s statement of affairs, produced when he tried to a deal with his creditors in the UK courts, said he owned a capital bond worth £1.1 million from a company called Investus UK Education Infrastructure Ltd.

The UK Companies Office, however, said this company was dormant with a net value of £100.

'Sham'
Meanwhile IBRC, the former Anglo Irish Bank, was also moving against Marley. It had installed receivers to an apartment block in Portsmouth known as the Roundhouse. When a loan related to this property went into default, IBRC tried to seize its rents but Marley fought back.

Marley claimed a management/letting agreement had been drawn up on June 15th, 2007, that meant the rents were moved into EPL back in Dublin.

On March 18th, 2013, IBRC finally got control of the rents. District Judge Simon Veysey concluded in a court order that the document dated June 15th, 2007, diverting all rents to EPL was "not a genuine document but is a sham and of no effect". In other words the entire basis of Marley taking the rents was wrong.

Savills’ IBRC’s receiver said EPL owed it £600,000 for the 14 months it took for the State-owned bank to win its case.

Back in Dublin, in April 2013 a creditors’ meeting of Ely Properties Limited in a hotel on Harcourt Street heard that matters relating to Marley had been referred to the Office of the Director of Corporate Enforcement.

Martin Jacob for liquidator Collins Garcia Corporate Recovery said the Garda Fraud Bureau had been made "aware" too of creditors' concerns.

Mr Jacob said he found it “deeply disturbing” that some rents had not been passed on by the company to landlords.

He said he was also aware too of allegations of “misappropriation” by various students claiming to be owed their deposits on properties formerly managed by Ely and that he would do his best to find out where these monies were.

Marley was in Malibu taking surf lessons at the time. He said: “This was a corporate raid, bullets get fired, people get hurt, it is not fraud. In a boom you build, in a recession you kill.”

Marley said he did not accept the legitimacy of the creditors’ meeting and that he would fight to clear his name.

An official from the Revenue Commissioners told the meeting a Revenue audit was ongoing of EPL and it was its view that the company’s records were “completely inaccurate”.

Marley was undeterred. He said was working on business plans to start again outside “toxic Ireland”.

Dispute
In December in Dublin's High Court the liquidation of Ely Properties was continuing. In the High Court a dispute between various parties in relation to the Steel Works, an apartment block in Dublin, was going on.

Various landlords owned the properties which Ely was supposed to manage and collect rents on from the Catholic Housing Aid Society, which placed aged or vulnerable people there as tenants.

The CHAS had stopped paying rents to Ely and wanted to know if it should start paying them directly to the properties landlords.

In an affidavit, Collins Garcia said it had been forced to report Marley to the Garda for “threatening and abusive communications, including threats on my life since the commencement of the liquidation”.

Marley said in response: “That is not true. I sent him a proverb which effectively said, ‘Bad men in one’s corner, the boxer loses.’ That was not a threat!”

Marley’s actual email uses the word “dies” but the north Dublin businessman said he couldn’t remember the exact phrasing.

Marley again said no rents had been misappropriated. “We have never made a payment to anybody that was not legitimate,” he said.

Maurice Ginty, an administrator working for the CHAS, said that from August 29th, 2012, the owners of the apartments in the Steelworks on Foley Street in Dublin began to complain that "Ely had apparently been failing to discharge rents to them".

Complete breach
"Ely was in almost constant and complete breach of its obligations to maintain the apartments and our reports of matters that required urgent repair were ignored to the extent that we had to carry out our own emergency repairs at our own expense in many instances, lest the apartments become uninhabitable for our residents," he alleged.

Ginty also claims in his affidavit: “I found myself at the receiving end of threats, this time from an individual calling on behalf of Ely who left me in great personal fear, such was the nature of his verbal threats about who he was and what could happen to me if the rents were not paid over immediately (if I ‘read the newspapers’ I would see that he ‘took no prisoners’.) I say that I am still in fear of this individual.”

“1,000 per cent that was not me,” Marley said. “I haven’t a clue where that comes from.”

Another affidavit outlined how an 82-year-old woman who owns a buy-to-let apartment managed by Ely fell behind with her mortgage repayments, her solicitor alleged, after she stopped receiving rents. Now, the solicitor says, the banks are chasing her for repayment and her health had deteriorated.

Philip Marley continues to work on reviving his fortunes. He did not respond to requests for further comment yesterday. Marley is based between Ireland, America and Gibraltar and plans to start again. He spent over a month last Christmas in the luxury surrounds of the Powerscourt Hotel in Co Wicklow.

Wilkey, who has her own business interests, is wealthy in her own right and there is no suggestion of anything inappropriate in their staying there.

It was a relaxing break for the couple. Wilkey told her 42,000 followers on Twitter: “Wow so #powerscourt in #ireland has been a real adventure! Can’t wait to see what happens next! #staytuned #presidentialsuitehereicome.”

How he made his millions

From his early days, Philip Marley was interested in business. In the late 1980s, while a teenager, he sold small ads to local enterprises on year planners he had made up around Finglas, north Dublin.

After school he studied at the College of Commerce in Rathmines but he was more interested in running discos and making money. “He was a bit of an Arthur Daley but he got things done,” an acquaintance who knew him at the time said.

Marley also ran a male striptease act called the Celtic Knights. In 1997 he packed his five-man troupe into a truck marked “100 per cent Irish beef” and deliberately drove it through a blockade of Welsh farmers protesting against Irish meat imports at Holyhead.

The resulting headlines boosted ticket sales. “We offer English women what they can’t get at home – prime beef on the bone,” Marley told the Sun.

Around the same time Marley set up Marley Media on Dame Street which ran drinks and other promotions for students.

As the boom began Marley was asked to work on sales brochures for developers. The money caught his eye. “I’m in the wrong bloody business here,” Marley told a friend.

In Dublin 1 on Foley Street a group of property investors were struggling to sell apartments in a complex known as the Steel Works.

Marley said he’d help. He hired professional advisers who put together a tax and marketing package that was enough to pull in buyers. It was 2004/ 2005 and he had just made his first serious money – believed to be about €500,000.

The Gateway student village in Ballymun was next for Marley. It too was struggling to sell and Marley’s combination of marketing chutzpah and tax package again helped him turn this into a success.

Marley decided to call his property business the Ely Property Group, named after Ely Place in Dublin 2 where his office was now located.

In August 2005, still only 33, Marley floated Ely on the AIM stock exchange in London.

He held on to 57 per cent of the shares in the company, which was valued at €17.45 million.

Marley was now a multimillionaire and he began to expand the business in Ireland and the UK while hinting he hoped to crack China and South Africa.

It was all go. In the summer of 2006 another company called Newcourt paid €22.3 million for Ely.

Its owners were on a mad acquisition drive fuelled by Anglo Irish Bank. Even Marley knew the price was too good to turn down. “They were foolish,” Marley later told a friend.“They were buying the future, not the actual assets.”

Marley was rich after the sale. He also had debts but it was nothing he felt he couldn’t handle. “You have to make your capital work and not have it stuck in assets,” was his mantra.

In late 2008 Marley formed the Metic Group, a specialist glass designer and installer for buildings, by merging various other businesses. Again the company was floated on AIM with a market cap of €17 million.

At the same time he bought back Ely from Newcourt, which was struggling under a debt mountain, for just €1, but he also took on its debts, estimated to be €40 million.

Marley’s timing was wrong. Metic stalled as construction stopped because of the financial crisis. Marley tried to restructure Ely and got €19 million refinanced in August 2010. It was all extremely difficult however. Gradually Marley’s grip began to loosen. Both Metic and Ely were in trouble with their banks.

Marley needed new deals.