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Archive for February 4th, 2013

As predicted on here yesterday, the saga of Mary McCabe’s 8.38 carat diamond ring is increasingly resembling a Georgian yarn about a lost or stolen five shilling note. Today, we learn from Dublin’s High Court that the famous ring, to which receivers were appointed last Thursday 1st February was in fact sold at a jewelry fair in Miami on 29th January. For USD 205,000 (€151,000).

It seems that the ring was given to Dublin jewelers John Farrington earlier in January – the precise date is unclear but it is reported that the ring was brought to Miami on 24th January and sold at a jewelry fair on 29th January – two days before the redoubtable Judge Peter Kelly was troubled with a NAMA application to have receivers appointed to it. It remains unclear at this point why Mary McCabe did not disclose all of this to the court last Thursday and neither NAMA nor the Judge is likely to be enamoured with this conduct. [UPDATE: despite there being correspondence before the court from the McCabes last Thursday, it appears that the NAMA application was an urgent ex parte one, and that therefore Mary McCabe might not have been aware of it]

Farrington’s are reported to have the necklace which will be handed over to the receivers who already have possession of the bracelet. But it was the 8.38 carat ring that caught our imagination last week. It was valued at around €150,000 by NAMA, and seemingly, NAMA will now receive the proceeds of the Miami sale, so NAMA is not out of pocket, it seems.

Dearbhail McDonald has reported on today’s proceedings in the Irish Independent.

Farrington’s were asked for a comment yesterday (Sunday) but at time of writing, there has not yet been any response.

UPDATE: 18th February, 2013. The McCabe ring yarn returned to the High Court again today, where the McCabes’ son, John said the family was consenting to the appointment of receivers over the three items of jewelery. A further twist has emerged in the yarn, with Farrington’s jewellers retaining €7,500 in commission before handing the remaining €143,000 approximately over to the receivers. Judge Kelly today noted that there was no impropriety on Farrington’s part but ordered that the commission be handed over to the receiver. The yarn gets better because NAMA or at least its receiver is apparently saying that John McCabe junior told him that there would be no sales commission. Oh, and the receiver will be seeking details of the buyer of the ring. The yarn might have some way to go yet.

UPDATE: 30th April, 2013. The ring saga seems to have concluded at the Commercial Court division of the High Court yesterday when Judge Kelly was informed that NAMA has agreed to let the jeweller, John Farrington, who had sold the ring in Florida to keep his 5% commission, equivalent to about €7,500. It is important to state that Judge Kelly characterised John Farrington as “an innocent” in the ring saga.

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Apparently, former Taoiseach Brian Cowen was none too happy with the two nude paintings of his corpulent frame hung by a “guerilla artist” in the National Gallery in 2009.  Our nakedness can be a great leveler, and how quickly the veneer of unchallengeable respectability fades away when an image is planted of you naked sitting on a toilet gripping loo-roll.

We are presently seeing a slow striptease by Minister for Finance Michael Noonan of the impenetrable and seemingly interminable promissory note negotiations. We still don’t know who is negotiating on behalf of Ireland, though apparently it’s employees of the Department of Finance, the Central Bank and the NTMA.

But the shield of “technical and complicated reengineering” of the debts shouldered by us all in respect of the promissory notes given to three institutions, including Anglo, is slowly being lowered as we get a sinking feeling that negotiations, that have been ongoing since September 2011 at least, are going no-where.

The view on here towards the negotiations has always been skeptical because it was never established who would be the counterparty to whatever benefit was coming our way. Nobody has told the Germans or the Finns that they might be expected to part with money to dig us out of a hole. And should the ECB ease the terms of the promissory notes in any meaningful way, then Spain, Portugal, Italy, France, Slovenia, Cyprus and others will be pointing to An Taoiseach’s game-changer last June when the EU summit communiqué said “similar cases will be treated equally”.

So what are we negotiating with? Two years ago, our hard negotiating chips were unilaterally reneging on the terms of the promissory notes or stopping the payments to bondholders in our bust banks. Since then, we have paid billions to the bondholders and there is presently very little left to be paid at what were Anglo and INBS. There are still billions due at the other banks, PTSB, AIB and Bank of Ireland, but these banks have been embraced as “pillar” banks and any default would have more serious consequences. We don’t want to deploy the hard negotiating chip of threatening to renege on the promissory notes because we fear the ECB might withdraw €70bn of funding to Ireland banks, and thereby collapse the economy.

So, all we have are the soft negotiation chips and they are as follows:

Europe needs a success story. Or what? And when? Europe, or rather the PIIGS periphery will definitely produce a success story. In time. Even Greece will work its way through its problems, its debt and deficit. It may default (again), have a civil war (again) but in the long run, it will reach some sort of sustainable economic equilibrium, even if it means the immiseration of its people. Italy is arguably a success story already because the price demanded by borrowers for its bonds is now around 4% long term, partly as a result of the ECB promising to “do whatever it takes” to support the euro. So, little old Ireland, with 2% of the EuroZone’s population and total economy, looks a little tragic on the periphery claiming Europe needs us to be successful.

We saved Europe, so where is the quid pro quo. Did we really save the EuroZone, because we didn’t allow any of our banks go bust which might have had a negative contagion effect throughout Europe? Or did we, contrary to the wishes of most of our partners in Europe, provide a comprehensive guarantee to our banks, and did some of us not even  crow about the guarantee, trying to tempt depositors in other partner states to transfer their cash to us? And even if we did save Europe, what class of eejits were we not to get commitments up front? And having repaid most of the bondholders in banks, even unsecured ones in the zombiest of banks, now, NOW we want our reward. This scale of naivete is breath-taking.

The Coalition will collapse if we don’t get a deal. And the implication is that the subsequent political turmoil will jettison us back to massive deficits, will lead to a breach of the bailout terms and may even lead to a messy default. Think about that for a moment. In fact here’s some photographic diversion to help you.

TheyComeAndGo

If Europe couldn’t give a rat’s ass about the political turmoil in Greece, the riots, the knife-edge votes in parliament, the austerity, the suicide in front of the parliament building, murdered policemen, strikes and four prime ministers in as many years, then on what planet does this Government think our partners will be concerned about transition from one centrist government to another. In any event, despite the broken election promises and the savage budgets, Fine Gael is still tops in the polls with 26-28%. FG. FF and Labour command over 60% in the opinion polls and even if Sinn Fein or the non-so-united Left or Independents came into power, would our partners be all that concerned? After all, they stood by as a rabidly neo-Nazi party took a grip on Greek politics.

TheyComeAndGoHereAlso

 

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“And by the way, being declared bankrupt in the UK does not mean NAMA loses interest in you – far from it” NAMA chairman Frank Daly speaking on a Dublin radio station in April 2012

First reported in the Sunday Times yesterday – not available online without a subscription – it seems that last week in Dublin’s High Court, the two bankruptcy trustees overseeing the bankruptcy of developer Danny Grehan initiated legal action – case reference 2013/949 P on 30th January 2013 – with the aim of having certain assets including assets allegedly transferred by Danny Grehan, returned to the benefit of creditors in the bankruptcy. Because the legal action has been initiated in Ireland, and not England, the speculation is that it relates to assets in Ireland.

According to the UK Insolvency Service, Danny was discharged from bankruptcy on 6th January 2013, having served his one year bankruptcy period. The main insolvency practitioner in the case is indentified by the Insolvency Service as Geoffrey Lambert Carton-Kelly of Baker Tilly Restructuring and Recovery LLP.

In the High Court application, the applicants are named as Geoffrey Carton Kelly and George Maloney, both represented by solicitors Gartlan Furey. The respondents are named as Daniel Joseph Grehan and Graham Grehan and as is usual with recently-filed applications, there is no solicitor on record for the respondents.

The Court Service confirms that Ray Grehan is NOT a party to this action – Ray was discharged from bankruptcy in the UK on 30th December 2012. Nor is NAMA a named party, though it is likely that NAMA is the main creditor to Danny Grehan, having obtained a near-€300m judgment in 2011 against Danny in Dublin.

The NAMA chairman Frank Daly has darkly warned developers that just because they get a quickie bankruptcy outside Ireland doesn’t mean NAMA loses interest in them. This is the present list of non-Irish NAMA bankrupts – that we known about, the list is probably not exhaustive.

Bankruptcies

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For a supposedly dysfunctional political system, Northern Ireland’s government is certainly delivering concrete reforms and decisions which are transparently improving the lives of its citizens. From Alex Atwood’s Department of the Environment’s furious activity with approvals of major construction schemes where economic and employment considerations are paramount to Sammy Wilson’s Department of Finance and Personnel delivering a Northern Ireland house price index based on all transactions – cash and mortgage, and myriad other reforms in between, you have to admire the initiative and delivery, even if it is in the overall context of governance by majority consent without opposition.

Today Nelson McCausland’s Department for Social Development has today announced Northern Ireland’s first residential tenancy deposit protection scheme which will be launched on 1st April, 2013. There doesn’t appear to be a press release from the DSD yet, but the BBC provides us with some details of the scheme with comments from the Minister.

There will be four administrators of the scheme whereby renters will pay their deposit to the scheme which will then arbitrate any disputes at the end of the tenancy. A similar scheme is currently in operation in the rest of the UK.

Despite noises made by the Government here, despite widespread unhappiness on the part of tenants with difficulties with getting deposits back, what progress has been made this side of the Border with designing or implementing a deposit scheme?

Zilch.

Minister for the Environment Nelson McCausland gets an annual salary of GBP 80,902 (€93,692). Our super junior Minister for Housing, Jan O’Sullivan gets €147,247.

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