Two brothers who claim they are victims of an "elaborate fraud" have secured a High Court order freezing the assets of a friend to whom who they gave €1.25 million to invest in various projects.

The action has been brought by Gary and David McGuinness against US-based David Morrisroe. They claim he has failed to answer their questions about funds they gave him in 2015 and 2016 to be invested in Irish and European property and precious gems.

They now believe no such investments were ever made by the defendant and that Mr Morrisroe has misappropriated money from them, which they fear is about to be dissipated and put beyond their reach, the court was told.

Ms Justice Leonie Reynolds granted the brothers interim injunctions including a world-wide order restraining Mr Morrisroe dissipating or dealing with the defendant's assets so as to reduce their value below €1.25 million.

The defendant must also provide the brothers with information on any worldwide assets he owns or has an interest in.

The brothers, represented by Stephen Byrne BL, want Mr Morrisroe to repay the monies to them, which he has failed to do.

They have reported the matter to An Garda Síochána.

The court heard Mr Morrisroe was put on notice of the proceedings, but did not attend court and was not represented.

In a sworn statement London-based businessman Gary McGuinness said he considered the defendant to be a close friend, whom he has known for many years.

Sought advice

In 2015 the brothers sought advice from Mr Morrisroe, who had held himself out to be an investment trader operating a large foreign exchange fund, on how to make returns on money they had inherited, it is claimed.

They claim Mr Morrisroe convinced them to invest in projects he was involved in.

Gary McGuinness said, based on what he was told by the defendant he believed the investments were in Irish property assets.

The investments include land in Oristown, Co Meath acquired from Nama; a property at Ailesbury Mews, Sandymount, Dublin; an apartment in Ringsend, Dublin; and a property in Croatia.

Mr McGuinness said Mr Morrisroe failed to engage with him when asked for updates on the brothers’ investments.

He said information on the investments he said was slow to come and information provided by the defendant was “largely, if not completely untrue”. He was not repaid monies due on the investment by the defendant.

He also discovered other information given to him by Mr Morrisroe, including that his father David Morrisroe snr had given the defendant $30 million (€25 million), and that he had sold an apartment in New York he owned, were not true.

In August 2019, Mr McGuinness said the defendant told him his father would repay the money but no payment has been forthcoming.

Relocated

David McGuinness said Mr Morrisroe has relocated to Chicago in the US. It appears the defendant has no property assets in Ireland, and is listed as a director of one Irish-registered company, Cloudshill Holdings Ltd, which has not filed any accounts, he added.

Mr McGuinness said the brothers attended Mr Morrisroe’s wedding in Chicago in 2019 just to get face time with him to discuss their investments.

Mr McGuinness said, when Mr Morrisroe recently informed him he was in the process of liquidating assets, the brothers became concerned any proceeds of sale would be dissipated.

In his sworn statement, David McGuinness, said information given to him by the defendant concerning property investments were “a fiction”.

Mr McGuinness said Mr Morrisroe approached him in 2016 about buying diamonds in Kenya.

Following a request from Mr Morrisroe, he said he transferred money to a third party.

After he made inquiries to the third party it transpired that there was no diamond deal, he said.

Mr Morrisroe had “lied to me” and owed the third party money, he said.

Mr McGuinness said his money had been used to repay Mr Morrisroe’s debt to the third party.

The matter will return before the court in two weeks’ time.