Pramit Ghose and Patrick Dempsey, two of the former partners in the liquidated Bloxham Stockbrokers, have agreed to contribute €150,000 and €45,000 respectively to the €16 million costs of winding up the limited partnership, the High Court has heard.
The stockbrokers’ liquidator, Interpath Advisory Ireland’s Kieran Wallace, is asking the court to approve the offers and to allow him cease taking further steps to secure contributions from them and others who were partners in the business when it collapsed in 2012.
Mr Wallace has told Mr Justice Brian O’Moore that four of the Bloxham partners do not have funds to contribute to the liabilities, while a fifth, the former partner in institutional equities Raymond Deasy, has been uncontactable for the last eight years.
The Central Bank directed Bloxham to cease trading in May 2012 after discovering “financial irregularities”. The oldest and third-largest brokerage in the State had a €5.3 million hole in its accounts.
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In a sworn statement to the court in support of his most recent application, Mr Wallace said he called upon all of the partners in October 2021 to contribute to the €16,712,000 costs of winding up Bloxham.
He said partners in place when the business entered liquidation were joint and severally liable to contribute to its debts.
Significant engagement has occurred since then and Mr Wallace said he was satisfied that former head of private clients Patrick Finnegan, former head of institutional bonds Peter Costigan, former head of asset management Niall Tinney and former financial and compliance partner Tadhg Gunnell do not have sufficient assets to contribute to the liabilities.
Mr Gunnell, who was immediately suspended in the wake of the collapse, was adjudicated bankrupt in 2015.
Mr Ghose, Bloxham’s former managing partner, initially offered to pay €85,000 towards the partnership’s debts but later agreed to up this to €150,000, the court heard. Mr Wallace said he is satisfied with the higher offer, which is “reasonable” in light of his financial circumstances.
The liquidator determined that Mr Dempsey, the former head of institutional equities, could contribute to the liquidation with assets he held in a partner account with Davy Stockbrokers. Mr Dempsey transferred €361,000 to the liquidation bank account in mid-2022 and a further €14,500 in early 2023, said Mr Wallace.
The liquidator had some concerns about Mr Dempsey’s statement of affairs and arranged a meeting with him. After this, Mr Dempsey’s wife, Clodagh Hughes, offered to contribute €30,000 to Bloxham’s debts on her husband’s behalf. Mr Wallace said he was satisfied the amount was reasonable.
Mr Wallace’s counsel, David Whelan, brought the application before the court on Tuesday.
Mr Justice O’Moore queried what he said could be kindly described as an “inconsistency” in Mr Dempsey’s statement of affairs.
Gary McCarthy SC, for Mr Dempsey, said a “fair and reasonable” €45,000 sum was being offered by his client, which included the €30,000 amount from Ms Hughes.
Mr McCarthy said his client has co-operated with the liquidator and has already contributed a “very considerable” €1.25 million to reducing the deficit. This is also “not the end of the road” for Mr Dempsey’s dealings with these matters, as two continuing court actions will see him face further calls from parties, Mr McCarthy added.
The judge directed various parties to file further sworn statements in advance of the hearing of Mr Wallace’s application seeking to be allowed to take no further steps to seek contributions to the Bloxham liabilities.
Barrister Keith Farry, for Mr Costigan, told the court he wants to submit an affidavit to verify the contents of a recent letter and a property valuation.
Mr Justice O’Moore adjourned the application, which he expects to hear in the autumn.
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