Docklands king's downfall – why Nama pursued Harry Crosbie

Solicitor’s letter reveals 11 reasons Nama decided to target developer

Harry Crosbie in happier times before the opening of the O2 arena in 2010. Photograph: Cyril Byrne

Harry Crosbie in happier times before the opening of the O2 arena in 2010. Photograph: Cyril Byrne

Fri, May 16, 2014, 01:03

On August 3rd, 2012, McCann FitzGerald, solicitors for Nama, wrote a five-page letter to William Fry, solicitors for well-known Dublin businessman Harry Crosbie.

It is an extraordinary letter to a man who over the decades helped transform Dublin’s docklands, notably by founding the Point music venue, now the O2, in 1988.

Mr Crosbie businesses’ have employed hundreds of people and generated revenues of between €100 million and €150 million a year for the city.

However, the contents of the August 2012 letter, which is disputed by Mr Crosbie, paints a different picture.

The 11 headings in the letter outline what Nama describes as “actions taken by Mr Crosbie . . . which had not previously been disclosed by him” at a time when he and his various companies owed the state agency €420 million.

Nama told the High Court the allegations in the letter were an important part of the context in which it was seeking to enforce a €77 million loan against Mr Crosbie.

The issues identified by Nama are detailed below with explanations in parentheses:

1 “Cash payments made to various family members, including payments of €740,000 and €650,000 to Mr Crosbie to Rita Crosbie [Mr Crosbie’s wife] following the acquisition of the connection’s loans by Nama. No approval was sought from Nama for these payments. It was also acknowledged by Mr Crosbie that, with regard to the payment of €740,000, these funds originated from the misappropriation of the AIL [the company that owns the O2 theatre] dividends charged in our client’s favour.”

2 “In 2010 and 2011, Mr Crosbie diverted dividend payments of €1.5 million, charged in favour of Nama, in respect of shareholding in AIL. This is a very serious matter for your client and it is regarded by Nama as tantamount to diverting monies to which the taxpayer is entitled. This matter must be addressed.”

3 “Following the acquisition of the property in Wexford [a holiday home and music studio] in 2007, we understand that Mr Crosbie spent in excess of €3.2 million on the property, which he continues to assert is held by his wife.

Details of the source of this funding has not been disclosed to Nama.”

4 “Nama has concerns about the value attributed by Mr Crosbie to chattels and to the contents of the various properties in which he and Mrs Crosbie have an interest. In this regard, Mr Crosbie has refused to permit a valuer to itemise and value the contents of the properties.”

5 “Your client has now admitted to holding a 45 per cent interest in an investment property in France, details of which were not previously disclosed. In fact your client repeatedly denied having any ownership interests in any French property, other than Cap Ferrat, when this matter was specifically and repeatedly raised with him on 21 June 2012.”

6 “Mr Crosbie misrepresented ownership of the leasehold interest in the property from which Cafe H [a bar and restaurant in the south docks] trades.

The lease is held by the Grand Canal Theatre Company Ltd and accordingly, is charged together with any income and profits from the lease, to Nama.”

7 “Mr Crosbie did not disclose significant cash gifts to and assets purchased for his children or the significant payment made to Trevor Bowen [former director of Principle Management, U2’s management company which was sold last year to Live Nation].”