Judge says Quinn asset scheme was the most devious plan he had seen
A “MESMERISINGLY complex” scheme devised by bankrupt businessman Seán Quinn and members of his family to put assets beyond the reach of the former Anglo Irish Bank has been described by a judge as the largest and most devious seen to date in the Commercial Court.
Mr Justice Peter Kelly said he had presided over the Commercial Court since 2004 and was having to deal more often with cases involving “national and international fraud, sharp practice, chicanery and dishonesty”. However, he had never seen anything like the conduct in this case.
He made the remarks when granting an application by Irish Bank Resolution Corporation, formerly Anglo, for the appointment of Declan Taite as receiver over the worldwide assets of various Quinn family members and over foreign companies based in Belize, Panama, Russia and the United Arab Emirates allegedly linked to the asset-stripping. The Quinns consented to those orders.
The judge granted IBRC interlocutory orders freezing accounts of various Quinn family members below €50 million. The Quinns also consented to those orders and filed no replying affidavits.
The judge said that, on the uncontradicted evidence before him, it seemed the Quinns had deliberately created and operated a scheme of mesmeric complexity, reeking of dishonesty, for the twofold objective of putting assets beyond the bank’s reach and to feather their own nests.
While a court could not make a final or binding decision on an interlocutory application, it had to be said all the evidence “points in one direction” in this case.
He had no hesitation continuing the orders freezing the accounts or taking the more unusual step of appointing receivers over the Quinns’ worldwide assets and accounts, he said.
The orders apply to Seán Quinn’s five adult children, his nephew Peter Darragh Quinn, two sons-in-law – Stephen Kelly and Niall McPartland, a number of foreign firms and any other party aware of the making of the orders.
The effect of the orders is to freeze the defendants’ accounts and appoint receivers over their assets, except for family homes, certain joint accounts and certain future earnings of some members of the family, unrelated to their international property group (IPG).
An interim account freezing order, returnable to Tuesday, was also granted against Karen Woods, who married Seán Quinn jnr earlier this year. The bank will on Tuesday also seek appointment of a receiver over her assets.
The defendant Quinns, plus Seán Quinn snr, are also to swear individual affidavits disclosing income and assets. The defendants must state what living expenses they require. The judge will decide sums to be allocated for those expenses on Tuesday. The defendant firms are also required to disclose income and assets.
Following an agreement between the Quinns and the bank, they had been granted up to €2,000 each in weekly living expenses since interim freezing orders were made earlier this month. Those expenses applied to the interlocutory hearing, but the bank has indicated it may not consent to similar future expenses.
The judge will also deal with an application on Tuesday by law firm Eversheds to be allowed to cease representing Peter Darragh Quinn due to inability to take instructions since he went missing last Friday.
Interim account freezing orders were granted earlier this month arising from developments affecting the bank’s proceedings, initiated last year, aimed at protecting up to €500 million in assets in the Quinns’ IPG.
The bank sought continuation of the freezing orders, plus the appointment of receivers as a result of developments which it said showed the defendants could not be trusted not to dissipate assets.
Those developments included the finding last month by Ms Justice Elizabeth Dunne of “outrageous” contempt by Seán Quinn snr, Seán Quinn jnr and Peter Darragh Quinn of orders of June and July 2011 restraining dissipation of assets in the IPG.
Other developments included publication of a video recording of a meeting in Ukraine in January 2012 which showed Peter Darragh Quinn was willing to lie to the court.
A third development involved disclosure of the fact all the Quinn defendants, except Brenda Quinn but including Karen Woods, had received after-tax salaries totalling nearly €2.8 million since April last year to an unknown date this year from IPG companies after the court order of June 2011 restraining asset dissipation.