Sean Quinn bankrupt over Anglo debts

 

Sean Quinn, once Ireland's richest man, has declared himself bankrupt in a Belfast court over nearly three billion euro of debts to the former Anglo-Irish Bank.

The entrepreneur's multi-billion empire collapsed over the last two years on the back of massive and secret stock market gambles on the share price of the now nationalised rogue lender.

But the bank, rebranded as the Irish Bank Resolution Corporation (IBRC), warned that Mr Quinn and his family owe the Irish state 2.9 billion euro (£2.5 billion) and challenged his claim of UK residency.

The 64-year-old was finally stripped of all control of his business empire in April this year and is involved in complex legal wrangles on the outcome of the collapse. He says he owes around 194 million euro (£166 million) to the bank, but disputes the remaining debt.

He was a true rags-to-riches story, setting out on his career with a £100 loan to dig gravel on his father's farm, but who was worth a reputed 4.72 billion euro (£3.7 billion) at the height of his business success.

"I was born, reared and worked all my life in Co Fermanagh. It is for this reason that my bankruptcy application was made today in Northern Ireland," Mr Quinn said.

"I have done absolutely everything in my power to avoid taking this drastic decision.

"The vast majority of debt that Anglo maintains is owed is strenuously disputed.

"However, I cannot now pay those loans which are due, following Anglo taking control of the Quinn Group of companies, which I and a loyal team spent a lifetime building. I find myself left with no other alternative."

Mr Quinn's bankruptcy declaration in the High Court in Belfast means he could be free of his debts in a year. If he had been forced into the same move in the Republic he would be out of business for 12 years.

The IBRC issued a statement disputing that Mr Quinn is resident in Northern Ireland and claimed the family live in Co Cavan, on the southern side of the Irish border.

"The bank is examining the validity of this application for bankruptcy in light of Mr Quinn's residency and extensive business interests and liabilities within the state," the IBRC said.

"The mandate of the IBRC is to recover as much of the debts as possible on behalf of the Irish taxpayer and IBRC will continue to pursue maximum recovery of his debt."

Mr Quinn's three-year long downfall started after he invested in Anglo using complex stock market deals known as contracts for difference, which allow the buyer to remain hidden but run huge risks if the share price shifts dramatically.

Mr Quinn gambled in the final years of the Celtic Tiger property and development boom on the share price continuing to rise.

It has been estimated that, at the top of the market, Mr Quinn could have been secretly in control of 15% of Anglo.

Trouble hit in late 2008 when the Anglo share price nosedived and Mr Quinn was forced to resign from his flagship insurance business, which was fined 3 million euro (£2.6 million) over financial errors.

Mr Quinn was forced out after using funds from Quinn Insurance as loans for other divisions.

Dubbed the "Mighty Quinn", he left school at 14 to work on the family farm and dug a hole on the land and opened a quarry selling to local builders.

From small beginnings he took on Cement Roadstone Holdings, which had the market sewn up, and then turned his business attentions to glass, plastics and ultimately what was to become the cash cow of his international empire - Quinn Insurance.

Mr Quinn accused the Irish Government of holding him at fault for the devastation wreaked on the Republic's economy after Anglo - the developers' bank - went bust.

"I worked tirelessly to find a solution to the problems, which arose from ill-fated investments in Anglo," Mr Quinn said.

"Anglo, and more recently the Irish Government, are intent on making scapegoats of my family and I."

In the lengthy statement issued after the bankruptcy declaration, Mr Quinn accepted some of the blame for his downfall.

But he accused Anglo - under investigation by the fraud squad and a corporate watchdog in Ireland - of self-interest, lack of responsibility and bad lending.

"I am not in the business of pointing fingers or making excuses," he said.

"However, recent history has shown that I, like thousands of others in Ireland, incorrectly relied upon the persons who guided Anglo and who wrongfully sought to portray a 'blue chip' Irish banking sector."

In a defiant defence of his businesses and investments, Mr Quinn launched a fierce attack on Anglo.

He claimed to have created 5,000 jobs in Ireland at one stage and paid 1 billion euro (£850 million) in tax.

Mr Quinn insisted that he did not bring down his empire, started in 1973, through the complex share trades which went belly up.

He has always maintained that he would have been able to service his debts if he was allowed to retain control of all divisions.

He was forced to relinquish control of the money-making Quinn Insurance wing in early 2010 after the Financial Regulator in Ireland warned its cash reserves had fallen below required industry standards.

"Anglo is now tirelessly working with its PR advisers to tell a different story of how I supposedly brought down the Quinn Group. This is wrong," he said.

"Anglo's actions, in taking control of businesses, have led to the present situation.

"The Quinn Group, prior to Anglo's takeover, was a very profitable business, which was paying all the interest on 100% of its debts, as well as having sufficient surpluses to develop further."

Mr Quinn accused the Anglo board and management, headed by former government minister Alan Dukes, of lacking the foresight to work with him, his family and those formerly at the head of the group.

"Instead, Anglo has supported and promoted an ill-conceived and highly damaging receivership programme, which I believe, if it continues on its current road, is destined for certain and catastrophic failure," he said.

"This will have wide-reaching effects on the local community in which I grew up and where I still live."

Mr Quinn also claimed that he has been subjected to relentless media coverage for the last three years and called for objectivity.

PA

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