Tuesday January 17, 2012

Court Rules Challenge Against Drumm's Bankruptcy Can Proceed

Ms Dwyer has already hired a realtor to dispose of Drumm's house in Malahide, Dublin (Photocall)

Former Anglo Irish Bank chief executive David Drumm is attempting to declare himself bankrupt in Massachusetts, but the court-appointed trustee in the case Kathleen Dwyer believes the claim is fraudulent.

The latest twist in this ongoing legal battle happened at a Boston court last Thursday.

Drumm was attempting to have Dwyer's challenge to his bankruptcy case thrown out on a technicality.

His legal team claimed that she filed papers on the challenge 51 minutes later than a deadline laid down by the court, and therefore the case should be thrown out.

But Judge Frank Bailey was having none of it.

He said Ms Dwyer could reasonably have expected to have had until the end of the day to file the documents and ruled that the case should proceed.

It's likely that the bankruptcy hearing will now go ahead in late Spring or early Summer.

Kathleen Dwyer is not the only one challenging Mr Drumm's attempts to declare bankruptcy.

His former employer Anglo, now owned by the Irish government and called the Irish Bank Resolution Corportation (IBRC), has launched a similar legal case against him.

In court, his legal team tried to portray the case as a "David and Goliath" battle, claiming IBRC is spending $2,000 an hour on legal representation.

Drumm, who has been living in Massachusetts with his family, quit Anglo in 2008.

He is believed to owe creditors in the region of €10.2m, including €8.5m to his former employer.

He filed for bankruptcy in 2010, claiming inability to pay, but the trustee put in charge of the case, Kathleen Dwyer, has refused to discharge his debts.

She is accusing him of being deceitful and failing to disclose details of cash and property assets.

Already Ms Dwyer has forced Mr Drumm to sell a $2.8m Cape Cod mansion, and has hired a realtor to dispose of his home in Malahide, Dublin which is worth around the same price.

Moves are also underway to force Mr Drumm to sell the home in Wellesley where he and his family were living until recently, which is worth around $1.5m.

There is some dispute over how much of that money would go to his creditors, as his wife claims half ownership.

Gardai are still looking to question Mr Drumm in relation to financial irregularities at Anglo Irish while he was boss there, but he has refused to return home to Ireland to co-operate with their inquiries.

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