HIGH-PROFILE developer John McCabe and members of his family used more than €6.2 million owed to the National Asset Management Agency to pay a potential investor and cover personal loans and tax liabilities, the High Court heard yesterday.
Mr Justice Patrick McCarthy yesterday granted Nama an order temporarily freezing the assets of John McCabe and his wife Mary McCabe, Rath Stud, Asbourne, Co Meath.
He made similar orders against their children John McCabe jnr, Helen McCarthy, Angela McCabe, Pauline McCabe and Sandra McCabe, also with addresses at Rath Stud.
Under the terms of the order, the McCabes cannot dispose, sell or transfer any asset worth more than €5,000, in which any of them has a legal or beneficial interest.
They are also prevented from taking any steps to sell, transfer or discharge a number of their assets including shares, properties and cash contained in bank accounts.
The matter is due back in the High Court on Friday. Their lawyer told the court that they denied any wrongdoing and asked to have the matter adjourned.
He also said that Ms McCarthy was a housewife who had resigned all directorships in the family’s companies some time ago.
The judge accepted that the evidence against her was not strong, but said her link to the other defendants was such that the orders could be made against her.
Nama sought the orders over its concerns that the McCabes had misappropriated or dissipated €6.26 million, including income generated by assets secured in favour of the agency.
The McCabes’ assets include Ashbourne Business Park in Co Meath and the Ardmore Hotel in Dublin’s Tolka Valley. Mr McCabe snr was one of the Maple 10, a group recruited by Anglo Irish Bank to buy its shares using cash loaned to them by Anglo.
The McCabes owe Nama €235 million and had agreed a repayment plan under which it committed itself to providing their businesses with a further €12 million in working capital.
In an affidavit, John Coleman, Nama’s asset recovery manager, said the agency’s claim was based on a letter it had received from the McCabes’ solicitors, St John Law, on August 13th.
Mr Coleman’s affidavit states that the solicitors’ letter shows that €4.48 million in directors’ payments and rental income from McCabe properties in Meath and Dublin, due to Nama, had been diverted by the defendants.
The affidavit also states that it appears from the letter that the defendants also diverted almost €1.78 million in equity releases from Rath Stud and an apartment in Park Lane, London, that should have been paid to Nama.
Nama believes that €4.85 million was paid to Western Gulf Advisory – a Middle Eastern-based organisation which at one stage was said to be interested in refinancing the McCabes’ debt and rescuing the business.
It believes that more than €927,000 was used to repay personal loans and diverted to a non-Nama bank, while €4,481 was used to cover personal tax liabilities.
The court heard the McCabes’ firms originally owed €235 million to Anglo Irish Bank, AIB and Bank of Ireland. Mr McCabe snr guaranteed this liability.
