A few weeks ago, Sean Quinn, once the richest man in Ireland, filed for bankruptcy protection. But according to sources, his bankruptcy filing has not gone the way he imagined it. First, Quinn (who made billions in construction and real estate ventures and lost it through a bad gamble investing in Anglo-Irish Bank), was not permitted to file his bankruptcy petition in Northern Ireland.
Like many other “bankruptcy tourists” in the Republic of Ireland, Quinn apparently wanted to take advantage of the United Kingdom’s more lenient bankruptcy laws to make his case. He was thwarted, though, just recently, when a court ruled that he had misled the Northern Ireland bankruptcy authorities about the hub from which he conducted most of his business.
Now, filing for bankruptcy in the Republic of Ireland (which is independent of the U.K., unlike Northern Ireland, which is under the U.K.’s aegis), Quinn will have to wait about 12 years before the bankruptcy is cleared from his credit record. In the U.S. Chapter 7 bankruptcy remains on a person’s credit report for 10 years, but its impact diminishes with time.
“A Personal Vendetta”
In a move that does nothing to make him seem more sympathetic, Quinn has now reportedly accused Anglo-Irish Bank of holding a “personal vendetta” against him, and for that reason making his bankruptcy filing more troublesome.
Briefly, Quinn’s history with Anglo-Irish Bank (AIB) is this:
- During the housing bubble, AIB extended itself beyond its means with ill-advised real estate loans.
- Convinced the bank would rebound from its troubles, Quinn invested in its stock, gaining as much as a 28 percent stake in the company.
- In addition to investing in the bank, Quinn also borrowed money to reinvest, putting himself largely at the bank’s mercy, should it collapse.
- In 2008, AIB was forced to nationalize to avoid complete collapse. The process resulted in eliminating investments Quinn had with the bank worth about €2.8 billion.
Now Quinn owes AIB more than €2 billion. The now-nationalized bank has since received an order from a Dublin bankruptcy court to collect that money from Quinn. During the course of his bankruptcy, he will likely have to pay most or all of what he owes, or surrender assets to compensate the bank.
At present, it seems the bank is legally pursuing collection of the loan, though Quinn maintains that its officers pushed him into making unwise investments that led to the debt in the first place.
If there’s any kind of “lesson” we can take away from this tale of wealth and woe, it’s one of relief: it’s always refreshing to realize that our debts are not quite as overwhelming as they might be.