A criminal investigation into Bula Resources' disastrous Mir Oil deal has yet to be launched because Bula has made no complaint to the Garda Bureau of Fraud Investigation.
The head of the bureau, Chief Superintendent Frank Glacken, said yesterday that no formal complaint has been received from the Irish company which lost £12.3 million in the deal set up by its disgraced former chairman and chief executive, Mr Jim Stanley.
Senior company executives met members of the fraud bureau in February and were told the Garda could not initiate an inquiry until Bula, the injured party in the affair, made a complaint.
The meeting came about because the stock exchange sent papers relating to the controversy to the Director of Public Prosecutions (DPP) in October of last year, because it believed a serious crime may have been committed. The DPP passed the papers on to the Garda in December last.
The company first became aware in May of last year that Mr Stanley might have lied to it about the ownership of Mir Oil. According to the report of the Government appointed inspector, Mr Lyndon Mac Cann, published last month, Mr Stanley failed to tell his fellow Bula directors that he owned the company, Mir Oil, to which the company transferred £2.5 million worth of Bula shares as part of a deal Mr Stanley negotiated in Russia.
Mr Ivan Walpole, a director with Bula who attended the February meeting with the fraud bureau, said yesterday the company had not filed a complaint because it had been awaiting the outcome of Mr Mac Cann's inquiry. If a Garda investigation had been launched, it would have simply been "put on someone's in-tray" pending the Mac Cann report, he added.
He also said the company wanted to secure an injunction to prevent Mr Stanley from reducing his assets anywhere in the world, prior to any criminal inquiry being initiated. Such an injunction was granted yesterday in the High Court.
There had been a possibility, Mr Walpole said, that lawyers for Mr Stanley could have argued against the granting of an injunction if a criminal investigation was underway. The lawyers could have contended that an injunction would prejudice Mr Stanley in the criminal proceedings. Mr Walpole said the company would be making a formal complaint to the Garda "shortly".
He said the Garda had agreed that the making of a formal complaint should be delayed pending Mr Mac Cann's report. Chief Supt Glacken said: "We made it perfectly clear to them that we can't make any inquiries until we receive a formal complaint".
The company is now hoping to retrieve some of the £12.3 million it lost in the Mir Oil deal by suing Mr Stanley. Yesterday in the High Court counsel for Bula, Mr Michael Cush, said it was apparent that Mr Stanley had been guilty of the most serious "fraud, deceit and breach of fiduciary duty".
A Bula e.g.m. will be held next month to discuss the Mac Cann report.
