Unfortunately, the UK Insolvency Service doesn’t allow searches on bankrupts’ former countries of residence, so it is not possible to search for (formerly) Irish-based individuals being declared bankrupt in the UK. The reckoning on here is that 17 developers* associated with NAMA have been declared bankrupt in the UK, but last week in the Dail, the Minister for Finance told the Fianna Fail finance spokesperson Michael McGrath that there have in fact been “approximately 20” – so we’re missing the names of “approximately” three. At least six of the “approximately 20” were resident in Northern Ireland.
Minister Noonan reiterated NAMA’s stance that it is neutral on the jurisdiction in which a developer is declared bankrupt. In one case – of an unnamed Northern Ireland bankruptcy, NAMA is opposing the discharge from bankruptcy. And in at least one other case – John Fleming – NAMA is seeking to attach the earnings of the discharged bankrupt, and is pursuing the private pension.
Last week, we learned the stance of the state-controlled Irish banks towards bankruptcy in other jurisdictions when the Sinn Fein finance spokesperson Pearse Doherty sought a response from Minister Noonan
“AIB: I am advised that the incidences of persons declaring bankruptcy in other jurisdictions are uncommon for AIB. Notwithstanding this, AIB considers each action on a case by case basis and will adopt an approach which best protects AIB’s financial and legal position as it seeks to recover outstanding amounts owed regardless of the jurisdiction involved.
PTSB: I am advised that PTSB also adopt an approach to best protect the Bank’s right to seek repayment of all outstanding debt in a fair and equitable manner regardless of the jurisdiction involved.
IBRC: I am advised by IBRC that the approach of the Bank is to work constructively with each borrower on an individual basis to identify the most appropriate loan repayment plan. IBRC takes a very serious view of borrowers seeking bankruptcy in other jurisdictions as a means of circumventing the repayment of monies owed to the Bank. Where necessary, and as has occurred previously, the Bank will pursue borrowers to ensure bankruptcy is declared in what it deems to be the correct jurisdiction, with the ultimate goal of maximising recovery of loans for the Bank. “
IBRC of course famously pursued former tycoon Sean Ignatius Quinn (“Sean Quinn”) who originally succeeded in declaring himself bankrupt in Belfast, but IBRC had that order over-turned and Sean was subsequently declared bankrupt in Dublin.
So, according to NAMA, it has not suffered loss from developers being declared bankrupt in the UK, and in fact NAMA has praised the established expertise of UK officials in tracing assets across borders. But in Sean Quinn’s case, IBRC obviously took a different view, which it presumably it took for financial reasons. Confusing.
* Ray Grehan, Danny Grehan, Tom McFeely, John Fleming, Bernard Doyle, Patrick Fitzpatrick, Tony Fitzpatrick, Paddy Shovlin, Michael Doran, Martin Doran, Alastair Jackson, Fergal McAlinden, Peter McDaid, Mervyn McAlister, Peter Dolan, Sam Thompson, Sean McWilliams
NAMA Wine Lake 
The reporting of this is curious. What benefit does it provide. So what, yes 20 developers have gone bankrupt in the UK….. Reasons?
No viable alternative in Ireland to write off their debt
No way ever to repay 100s millions of debt
Banks and Nama not dealing constructively with them
Need to move in with life
Nama have no choice other than to go with this. They can always seek to have a trustee appointed which they do in cases where they think the may be some assets to realise. It would be the same in Ireland anyway, so the only reason this is of any interest is because the bankrupt is not going thru the penuary of a 12 yr bankruptcy to punish them for their folly.
There will be many many more of these in the next six months as the new legislation does nothing to help them escape their debt burden.
@Steve, in Ireland your creditors can continue to take your excess income for 12 years. For high-achieving folks like developers, that extra 11 years might be worth millions of euros. Creditors can “forgive” you after five years but that “forgiveness” of the remaining seven years is usually in return for you offering up every asset you have, and perhaps even assets that strictly the creditor has no right to, like your spouse’s assets.
Despite what NAMA claims, I can see a financial reason for preferring an Irish bankruptcy.
[…] Unfortunately, the UK Insolvency Service doesn’t allow searches on bankrupts’ former countries of residence, so it is not possible to search for (formerly) Irish-based individuals being declared bankrupt in the UK. The reckoning on here is that 17 developers* associated with NAMA have been declared bankrupt in the UK, but last week in the Dail, the Minister for Finance told the Fianna Fail finance spokesperson Michael McGrath that there have in fact been “approximately 20” – so we’re missing the names of “approximately” three. At least six of the “approximately 20” were resident in Northern Ireland.Source: wordpress.com […]
I See Sean Mc Williams has been added to the list since we last spoke
@NWL
Any Documents to Support view that Mc Williams had any dealings with Agency,Last week we did not have any
@Patrick, yes the Ballymacool estate in Letterkenny appears on the latest NAMA foreclosure list!
The reality is that the only reason they are in this situation was that they gave personal guarantees to the banks. There is very little reason otherwise since all were trading within the device of the limited company. So all other creditors are pretty much stuffed. Therefore all we are dealing with are the banks and NAMA.
Can PG’s be transferred as property.
@Vince. Just a factual correction. Not all developers traded within a Limited Company. Many structures were used (including QIFs and Trusts) and to take advantage of the very generous tax breaks, many held property investments in their personal capacity.
“Can PG’s be transferred as property?” I assume by this you mean can property be transferred to a debtor to satisfy, and in lieu of, a personal guarantee? The answer is “Yes, by agreement.”
What I mean is that the PG is given to the bank. But NAMA has taken over the loans. Can the PG transfer with the loan or is it that the PG is given to the one entity, the bank.
Basically what is it’s nature. Is it property.
Yes…..it really depends on its nature,they vary and are negotiable,but they normal run with the paper.So if Anglo originated the loan and secured a PG,and the loan is in NAMA the PG transfered with it.
If NAMA then sells the loan,the PG is also attached.If the question is what value is attributed to this “property” that is dependent upon the assets of the person who provided the PG and the insolvency legislation in that jurisdiction.If the loan is in the UK with modern BK legislation or the US there is little or no value given in the secondary debt markets to them.
Not much fun tryin to collect or perfect them,epically if you bought the loan at a significant discount or the paper is “bad”.No idea in Ireland if two loans one with a PG one w/o would trade differently.
There is a strategy called “cash for keys” where buyers actually PAY the borrower to vacate and return the property!
BofA operates it as do many other institutions,coming soon to Ireland,via off shore hedge funds and large international banks.
“Mega-lender Bank of America is extending an experimental program in Florida — where nearly half of all home loans are underwater — to curb foreclosures with cash-for-keys deals.
The bank, which services 1.1 million Florida mortgages, is now giving struggling borrowers until Dec. 12 to apply for its program, which pays borrowers who agree to expedited short sales at bank-set prices.
Typically, payments range from $5,000 to $20,000. In addition to the cash, many borrowers are also absolved from any future deficiency judgments.”
http://www.heraldtribune.com/article/20111202/ARTICLE/111209909
@Vince. It is as John Gallaher states. The PGs transfer with the loan – not with the property. NAMA has already stated that it put no value on the PGs when it acquired the loans.
At Anglo’s credit committee, at the initiation of the loans, no value was placed on its customers’ PGs. The bank knew that its customers could never cover loans of €100 million plus or anything like it.
Unlikely they will be provided again carte blanch like they were,James Reilly is certainly regretting ever providing one.They were not only provided to banks but also to investors and buyers,where developers “guaranted” rent from vacant space.
It encourages reckless lending as banks get lazy and rely on them rather than the merits of the project.Route 1 for distressed debt buyers in striking contrast to NAMA,is too have original borrower refi or pay off the debt at a discount.If you have paid 20 cents for loans attempting to perfect PG’s is last option as you have such a low basis.Its also frowned upon as a business strategy,takes a particular obnoxious personality type to pursue PG’s.Sophisticated investors don’t do “personal” themselves,no one wants to harass people for payment,awful way to spend ones time and energy,very demoralizing.