Dan White: IBRC will come after David Drumm for everything he has got
Dan White ·
IBRC will come after former Anglo boss David Drumm for everything he has got, now that he has lost the protection of the US bankruptcy system.
Last night the US Bankruptcy Court refused to allow David Drumm, the former chief executive of Anglo Irish Bank (now IBRC), to declare himself bankrupt in America. This means that he is still liable for his debts of more than €10m.
Mr Drumm moved to the US in 2009 after being forced to step down as Anglo boss and filed for bankruptcy the following year. Being able to declare himself bankrupt in the US would have allowed him to walk away from his debts and make a fresh start.
IBRC fought his US bankruptcy filing every inch of the way. It alleged that he had hidden transfers of cash and assets to his wife Lorraine – money that should have gone to his creditors – from the bankruptcy court in his filing application. The court-appointed bankruptcy trustee Kathleen Dwyer agreed.
In a devastating ruling Bankruptcy Court judge Frank Bailey has come down on the side of IBRC and Ms Dwyer. Judge Bailey described Mr Drumm’s evidence as being “not remotely credible” and “filled with efforts to misdirect and outright lies”.
The US bankruptcy system is one of the most liberal in the world. Bankrupts are discharged, i.e. can walk away from, their debts after just 12 months. The flip side is that anyone filing for bankruptcy stateside must make a full disclosure of their financial affairs, one person who has been through the process has likened it to “getting naked in public”.
Those like Mr Drumm who fail to do so are not allowed to declare themselves bankrupt and remain on the hook for their debts. Now that the US Bankruptcy Court has delivered its ruling expect IBRC to chase Mr Drumm for every cent he has got.
With US bankruptcy no longer an option will Mr Drumm return to this country, something he has refused to do up to now?
Who knows, maybe he will end up giving evidence to the Oireachtas Banking Inquiry after all.