Timeline of David Drumm’s US bankruptcy A story of hidden assets, secret transfers and false oaths

From banking crisis to bankruptcy to trial

The former Cape Cod home of David Drumm, former CEO of Anglo Irish Bank. Photograph: Cape Cod Times

The former Cape Cod home of David Drumm, former CEO of Anglo Irish Bank. Photograph: Cape Cod Times

Fri, May 16, 2014, 01:20

2008

September 19th
For the first time since marrying David Drumm in 1991, Lorraine Drumm opens a bank account in her own name. The account is opened in Anglo Irish Bank where Drumm is chief executive.


September 20th
As the Irish banking crisis deepens, minister for finance Brian Lenihan, to stem a bank run, increases the amount of customer money protected by the State’s deposit guarantee from €20,000 to €100,000.


September 22nd
At Anglo, David Drumm unsuccessfully attempts to broker a merger with Irish Life & Permanent to strengthen the bank as the crisis deteriorates. Internal documents showing loans to directors, including loans of €8.5 million to Drumm, are formally signed in preparation for the bank’s accounts.


September 24th
Drumm transfers €150,000 from an account at Anglo to his wife’s new account. At Anglo around this time, the bank is losing between €500 million and €1 billion in deposits every day in the crisis.


September 30th
The Government introduces the bank guarantee to try to protect all the domestic Irish financial institutions but in the first instance to stop the run on Anglo Irish Bank. Drumm obtains 100 per cent interest in a house at 173 Cross Street in the Cape Cod resort of Chatham, north of Boston.


October 20th
David Drumm transfers 50 per cent of his interest in the Cross Street property to Lorraine.


On or around November 3rd
A transfer of €80,000 is made from the couple’s joint account at AIB to Lorraine’s AIB fixed -term account. A transfer of €50,000 is made from Drumm’s account at Anglo to her account at the bank.


December 3rd
Anglo’s share price plummets 29 per cent to its lowest level in 11 years after setting aside more money to cover increasing losses on property loans when it published its yearly accounts to September 2008.


December 12th
Anglo tells the government that it cannot survive on its own and needs help to raise capital. That same day Lorraine Drumm opens another bank account in her sole name at AIB.

December
The Drumms are granted a €250,000 mortgage from KBC Homeloans on a residential property that they jointly own on The Way at Skerries Rock in north Co Dublin.


On or around December 12th
A transfer of €180,000 is made from the couple’s joint bank account at AIB to Lorraine’s new AIB account.


On or around December 15th
A transfer of €372,561 is made from the couple’s joint account at AIB to Lorraine’s new AIB account.
December 18th
Sean FitzPatrick resigns as chairman of Anglo after admitting that he hid €87 million in loans from shareholders by shifting them between Anglo Irish Bank and Irish Nationwide Building Society.


December 19th
David Drumm resigns as chief executive of the bank over the same controversy.


2009

January 14th
Anglo Irish Bank is nationalised.


February 2nd
Lorraine Drumm withdraws $250,000 (€198,208) from her AIB account and wires the money to an account in a Cape Cod Five Cents Savings Bank owned by David Drumm’s new US consultancy business, Harborlight Capital Partners. He later renames it Delta Corporate Finance. To qualify for an E-2 Treaty Investor Visa to live in the US, Drumm has to invest money in an American business.

On or around May 5th
Drumm sells his Range Rover SUV for €36,000. The sale proceeds are deposited in Lorraine’s bank account.


June
David Drumm, his wife and two daughters move to the United States.


On or around June 15th
A transfer of $99,991 is made from the Drumms’ joint account at a Cape Cod bank to Lorraine’s AIB US dollar account.


September
The Drumms sell the Cross Street house in Cape Cod for $2.365 million, generating net proceeds of $412,000, half of which is deposited in Lorraine’s account at the Cape Cod bank.


On or about September 7th
Drumm sells a BMW vehicle to his sister for about €20,000. The sale proceeds are deposited in an account at AIB jointly owned by the Drumms.


On or around September 12th
A transfer of $1,500 is made from David Drumm’s Cape Cod bank account to a joint account held by the couple at the bank.
On or around September 18th
Drumm transfers $1,000 from an account belonging to his consultancy business Harborlight at the Cape Cod bank to the couple’s joint account at the bank.

On or around September 19th
A transfer of $1,000 is made from Drumm’s account at the Cape Cod bank to their joint account.


On or around September 28th
A transfer of $3,000 is made from Drumm’s account at the Cape Cod bank to a joint account.


November 24th
The Drumms buy a new family home at Old Colony Road in Wellesley, a suburb west of Boston, for $2 million funded by a $1.23 million mortgage and $831,000 in cash from Lorraine’s bank account at Boston Private Bank. The house was purchased by a trust, Epiphany Nominee Trust, which was owned equally by David and Lorraine Drumm. Their names do not appear on public property records.


2010

October 14th
David Drumm voluntarily files for Chapter 7 bankruptcy in Boston after failing to reach a settlement agreement on his debts with the new management team at Anglo hired by the government.


October 29th
Drumm files financial statements in the bankruptcy court showing debts of $14.3 million (€10.2 million), including $12 million (€8.5 million) to Anglo Irish Bank. He values his assets at $13.9 million, including his Anglo pension at $5 million, a counterclaim of $3.6 million against the bank for unpaid salary and benefits along with personal property and effects including the family dog, which Drumm valued at $1.


November 16th
Drumm attends a “341” meeting with creditors, the first of six meetings with creditors over a 10-month period.


2011

April 1st
Drumm attends his fifth and penultimate meeting with creditors.


May 17th
Drumm files amended financial statements in the bankruptcy court. The new statements include the transfer of 50 per cent of the Cross Street property to Lorraine in October 2008, the sale of that property for $2.365 million September 2009 and 14 other transfers totalling $765,429 to his wife that were not included in his original financial statements filed in court the previous October.


August 31st
Anglo Irish Bank file a legal action against Drumm claiming that he should not be entitled to a discharge from bankruptcy on the basis that he concealed assets, defrauded creditors by transferring money and property to his wife and made false statements in his US bankruptcy proceedings. Boston lawyer Kathleen Dwyer, Drumm’s trustee – the court-appointed officer overseeing his bankruptcy – files a separate but identical complaint against the former banker, also seeking to deny his discharge.


2012

January 27th
The separate actions taken by Anglo and the trustee against Drumm are consolidated into one case.


2014

May 2nd
In a pre-trial statement, Drumm claims he transferred money to his wife from September to December 2008 because their marriage was strained, he was working very long hours during the banking crisis and she was concerned that something might happen to him and she had no money of her own.


May 21st
Drumm’s bankruptcy trial to decide whether he should be discharged from bankruptcy and given a fresh financial start is scheduled to start. He will be the first witness called during a trial listed to last five days.