Builders Michael and Thomas Bailey have been disqualified from acting as company directors for seven years after the High Court yesterday found they were guilty of "particularly serious" misconduct and fraud.
However the owners of the Bovale construction group, based in Batterstown, Co Meath, are to ask the court on January 20th to limit the orders against them so they can continue to deal with the State-owned National Asset Management Agency (Nama), which the brothers want to fund their UK and Irish projects.
The ruling yesterday by Ms Justice Mary Finlay Geoghegan referred to the brothers' "particularly serious" misconduct involving "systematic falsification" of books of account and a €6 million understatement of their gross remuneration in the two years' to June 1998.
The case against the brothers was taken by the Office of the Director of Corporate Enforcement (ODCE) in 2006 and had been delayed by appeals to the Supreme Court over aspects of the case.
In 2006, the brothers made the largest tax settlement ever published by the Revenue Commissioners when they paid €22.17 million in tax and penalties. Such settlements are only published when the taxpayers concerned has not made a qualifying voluntary disclosure.
There was no response to a request for a comment from the brothers. A spokesman for the ODCE said it welcomed the judgment.
The planning tribunal found that Michael Bailey (63) made corrupt payments to the former Fianna Fáil minister Ray Burke and the former Dublin planning official George Redmond. It also found that Michael and Tom Bailey (52) had obstructed the tribunal in its work.
As part of the evidence against the brothers that led to yesterday’s judgment, PricewaterhouseCoopers examined the Bovale books , with a managing partner of the financial firm saying that during his 35-year career in Irish public accounting, he had never encountered such a failure to maintain proper books and records.
Established in 1983, Bovale Developments was one of Ireland’s largest house-building operations.
Loans to the business were moved to Nama after the economic crash and recent accounts indicate the brothers are trying to negotiate ongoing financial support from the State agency in order to keep their business from collapsing both in this jurisdiction and the UK.
The UK business had accumulated losses of €54.7 million at the end of September 2012.