O'Donnell suspected of siphoning sales funds
Bank of Ireland was suspicious that property investor Brian O’Donnell was siphoning funds from property sales forced on him after the international credit collapse, a senior bank executive has told the High Court in London.
The bank held off from legal action against Mr O’Donnell and his wife, Mary Patricia, for three years, said executive Des Hanrahan, who added that “every option” had been given to them. The O’Donnells have filed for bankruptcy in England and Wales.
Mr Hanrahan told the court that Mr O’Donnell had declared £120,000 of the €500,000 he received for Irish properties, while the bank had taken a tough line during the sale by him of the British department of education’s headquarters last year because it suspected that he was doing the same thing.
He said the couple should be bankrupted in Ireland, not England and Wales, because their base was in Dublin, not in London as the couple insisted, adding that it was “very expensive”for a creditor to deal with a bankruptcy abroad.
Paul Burton, for the O’Donnells, said the bank had not raised the issue of their claims to a London base during negotiations early this year about the couple’s desire then to reach a deal on a step short of bankruptcy.
However, Mr Hanrahan said it was not necessary then, as solicitors Arthur Cox had last January made clear the bank’s opposition to the couple’s claim that their centre of main interest was in London.
Mary Patricia O’Donnell’s allegations that the couple’s art collection had been deliberately overvalued on bank orders to get loans approved by the bank’s credit committee were “absolutely scurrilous”, said Eoin Geoghegan of Bank of Ireland Private Banking.
He said he dealt with the O’Donnells between 2006 and 2008 in Bank of Ireland Private Banking, adding that they had repeatedly filed statements of affairs that valued their collection at between €5-€7.5 million.
Earlier Dr O’Donnell told the High Court that the move to London, “which had been absolutely fixed in our heads”, was delayed by several years after 2007 because her youngest daughter, Alix, suffered a serious illness.
“A member of the family wasn’t very well,” she told Mr Burton, reluctantly acceding to his request that she should give more information to Mr Justice Newey.
Repeating her declaration that she did not want to live in Ireland, Dr O’Donnell said “business people are an endangered species” there.
Earlier, she said she did not want to “live in a bankocracy”.
Dublin builder Declan Byrne, who had a €200,000 court judgment in his favour against Mr O’Donnell, said he had not challenged the couple’s UK bankruptcy declaration because he had already spent €600,000 on legal bills.
Mr O’Donnell had failed to pay for work on the Merchants Arch building in Dublin, even though the contract stated that payment had to be made seven days after architects signed off. “They were stealing my money,” he told the court.