Jackie Lavin's patience with celebrity trivia has worn thin, clearly. Recently, when news of a law suit against her partner, Bill Cullen, over Killegy House in Co Kerry, morphed into a "Bill and Jackie are breaking up" story, the couple felt bound to issue a statement saying this was not about "Bill and Jackie".
“You’d swear it was Brad Pitt and Angelina Jolie crap . . . I don’t want it to be about that sh**e. I want it to be about the issue,” she says.
And the issue?
She said they were “put into the Global Restructuring Group (GRG) of Ulster Bank” and the company was taken “from under us for no good reason other than the fact that our property was worth more than our loans”.
You might be thinking, well, she would say that, wouldn’t she ? She knows. She is well aware that the travails of the Bills and Jackies are viewed with a hefty dose of Schadenfreude.
Her High Court action against Bill Cullen and one of his companies, Glencullen Properties Ltd, over an alleged failure to complete a deal for the sale of Killegy House to her was briefly mentioned in the High Court last Thursday. It is to be heard in October.
“You know the resentment that’s out there,” she says, launching into a freeform version of what she believes to be the national perception of them: “‘Oh God help them, sure they lost their millions isn’t that tough, sure we never had any millions to lose so therefore aren’t we grand, and sure we didn’t borrow the millions and isn’t that terrible.’”
And by taking that view, she says, everyone is missing the point. “It’s all relative – whether you lost millions or whether you lost 10 grand or 100 grand, it’s the same thing. The same trauma and persecution that you’re going through with the banks”.
In the showroom of Bill Cullen Premier Cars, a small, spartan premises on a dusty run of the Naas dual carriageway in Dublin, Lavin gestures towards some hulking Ssanyong four-wheel drives.
“I work on the floor now. I had to learn about cars. It’s important to have something to go to when you wake up in the morning. More than that, it’s very important for Bill to have somewhere to go . . .”
The man whose name is over the door, once the 100 per-cent stakeholder in Glencullen Holdings, is not present. Glencullen was driven into receivership in October 2012, when around 200 employees lost their jobs, had their car keys taken, were told to get the bus home, and paid only to the end of the week.
But Lavin now has the authority “in writing, to speak on behalf of the company, sent to Ulster Bank”. Part of her strength is that she owes nothing to no-one, she says, because she and Bill are not married. In fact, she claims money is owed to her because she paid for Killegy House, “which [the receivers] are now denying . . . I don’t want to be a victim. I want justice”.
They never married, she says, “because he is not divorced”. But her devotion to her 75-year-old partner of 37 years, and her battle for his legacy, are palpable. “For better or worse, we’re together”, she says with a wry grin. “And supportive.”
Assets
It was Lavin who appeared before the Oireachtas Finance Committee in January, representing the grievances of Glencullen and some 60 members of the Ulster Bank/GRG Action Group. Their case is that when Royal Bank of Scotland (RBS), Ulster Bank's parent, hit catastrophic losses of £24 billion and saw its share price fall by 66 per cent, it instigated a so-called "Dash for Cash" strategy. It targeted UK and Irish companies who owed between €1 million and €25 million, but whose assets were worth more than their loans, and gathered them into the GRG.
Call those customers gullible, but they assumed, apparently, that the nice people of the “turnaround” GRG division, were here to hold their hands, restructure debt, reduce interest rates and so on – in short, guide them through the hard times as a caring business partner would.
Instead, Lavin told the committee, the GRG turned out to be “a purpose-vehicle designed to take down” the companies. More than 2,000 Irish businesses had experienced “abuse, breach of contract, breach of fiduciary duties, and maleficence at the hands of Ulster Bank’s GRG, leading to a tsunami of receivers being appointed, businesses closed and lives and families ruined”.
And to demonstrate that this was not just about the Bills and the Jackies, they estimate conservatively that those businesses had employed more than 20,000 people –“equivalent to several large multinationals” – with a tax contribution of more than €250 million a year.
In response to questions from The Irish Times at the time of the Oireachtas committee hearings, Ulster Bank rejected that the scheme engineered defaults. "During the period 2008-2013, Ulster Bank granted extensive forbearance to the vast majority of the customers managed in Global Restructuring Group Ireland (GRGI)," a spokeswoman said at the time, adding, "In line with the process underway in the UK, Ulster Bank is making the same supports available to our SME customers in GRGI during that period. Ulster Bank strongly rejects any claims that businesses in GRGI were artificially distressed by GRGI and a number of independent reports have supported this conclusion."
While Ulster Bank was not officially part of the bail-out inflicted on the Irish taxpayer, Lavin points out that these are costs that appear nowhere in such calculations.
“What about all the mortgages of the people who lost their jobs? What got me aggravated and annoyed was that the government only seemed to be focusing on mortgages and trackers and all that – all very legitimate. But they don’t relate it to the businesses that were taken. The businesses that were employing all those people. Do they not think that most of them went into mortgage arrears that month, or about how long it took them to get another job? Who paid for the redundancies and the Jobseekers’ benefit?”
Even for a people punch-drunk on rotten bank behaviour, it is hard to credit that any institution would act with such deliberate callousness. Yet Lavin states her case – and others' – with particular reference to whistleblower revelations contained in a BBC2 Newsnight/Buzzfeed report last October, showing how RBS, Ulster Bank's parent, bought up assets cheaply from failing businesses it claimed to be helping.
It reported that in Britain, more than 12,000 companies were pushed into the GRG, RBS’s “turnaround” division – sometimes simply for falling out with the bank – in the wake of the crash; that staff were incentivised to search for companies that could be squeezed, or have their interest rates bumped up, in what one executive called “Project Dash for Cash”. These revelations supported previous controversial allegations that RBS had deliberately put viable businesses on a path to destruction while aiming to pick up their assets on the cheap.
The documents also showed that where business customers had not defaulted on their loans, bank staff could find a way to “provoke a default” – “If the company has not defaulted, we can engineer one”. Many business owners complained that unrealistically low valuations were used to claim they had breached their borrowing limits and force them into the GRG.
From there the bank sought to squeeze cash from the businesses through higher interest and fees, pressuring customers to sell assets to pay down loans, taking an equity stake in their businesses, or by pushing the business into administration.
In just one year, 2011, GRG’s income from fees exceeded its expenses by a wide margin, returning a profit of £1.2 billion (€1.4bn). Indeed, RBS’s own auditor, Deloitte, was concerned there was a “reputational risk” of “perceived conflicts of interest”.
This, basically, is also Lavin’s case. Glencullen Holdings had been a highly successful customer of Ulster Bank since 1990 and had never defaulted on a loan. But when hit by cashflow problems in 2009, the bank pulled in all properties in the group, giving them “an overall cover of properties worth €65 million for a debt of €10.5 million and a €1.5 million overdraft”. Two years later, it put the company into GRG, and a squeeze was immediately put on cashflow and other operationally-sensitive areas of the company.
Cullen, who had sold the Renault national franchise to Renault in 2007 for a tidy sum, and continued to trade in his five dealerships, had invested €20 million of his own money in the company that year. Unlike many other high-flyers, he had not involved himself in property plays, but stuck with what he had known since the age of 15. In the end, all of it, together with his personal pension, went down with the company and into the bank.
Relentless pressure
Like many businesses operating under relentless pressure – as outlined in the submission – the story is complicated. Lavin is unable to produce documents because, she says, Ulster Bank has consistently refused to surrender any documentation on the loans, or payment schedule, or bank accounts and they do not have the huge financial resources to go to court for them. And when agreements were made, she claims, nothing was ever put in writing. Most email evidence was taken when the receivers took away the computer servers.
The action group's Oireachtas submission states that although Ulster Bank claimed to have "no appetite for the motor business", it had advanced large "pre-pack" loans to Glencullen competitors to buy out a couple of its prime garages and that Glencullen's customer database was used to market the new dealerships. It also claims confidential financial information was passed between the bank and Renault, Glencullen's major supplier. These are serious allegations, already in the public domain for several months but still awaiting a response from any authority, according to Lavin. She has written to the Central Bank and the Financial Services Ombudsman among others, seeking an enquiry into Ulster Bank's operations.
In Britain, RBS has conceded mistakes were made. The bank told the Newsnight programme that "since that time, RBS has become a different bank and significant structural and cultural changes have been put in place, including how we deal with customers in financial distress". But it also insisted a detailed review of millions of pages of documents had found no evidence that "the bank artificially distressed otherwise viable SME businesses or deliberately caused them to fail."
In the end, the debt-stricken company that Cullen had long ago acquired for £1, and built into a business that won the French government’s Legion d’Honneur for his contribution to Renault France, vanished with nearly 2,140 others into GRG. Of those companies pulled into the “turnaround” division’s embrace, just six emerged. Ten days after the receiver took over in 2012, Cullen’s 56-year-old brother, Aidan, managing director of Glencullen’s Airside dealership, died suddenly of a heart attack
Publicity
Although Lavin had no part of Glencullen, the latest publicity blow-up stemmed from her legal action to hold on to Killegy House and hunting lodge in Killarney, which she bought privately from Glencullen Property Ltd – formerly owned by Cullen – in 2011.
“Bill is the named person in the lawsuit because he was the main shareholder in the company, so it’s him representing the company that’s being sued. Anybody with a brain in their head would have known that . . . Instead they [the media] went the other route and that stuff about Bill and Jackie breaking up.”
Killegy House is her home, she says, “because I don’t have any other home. I’m not entitled to Osberstown House [where she lives with Cullen which is not under Ulster Bank’s remit] because we’re only living together. I’m only entitled to everything I put into it. I have no rights as a cohabiting partner. After 37 years, I have the same rights as somebody who popped in and decided to live there eight days ago. The place was a wreck . . . We bought it for £400,000 in 1991, so we didn’t suddenly buy a mansion in the country for several million. I’m the builder in the company. I’m the one who designed the hotel in Kerry [the five-star Muckross Park Hotel, also lost in the domino effect]. I have the original drawings. That’s what I do”.
One of her current chores is listing and vouching for every single contribution she made to Osberstown House over 25 years, down to hiring the painters and paying for the paint, the bricks, the curtains and all the rest. “That was and is the most demeaning thing I have to do”.
Celebrity
People who saw the celebrity lifestyle and assumed the couple had simply been greedily grabbing at bank money do not understand, she says. “Obviously it would engender a lot of begrudgery in people who feel that you suddenly landed there. They didn’t see what you had to do in order to get there. They’re the people who don’t have the head space to do it themselves, or maybe the work ethic or whatever. Not everyone can do it, that’s perfectly understandable – but don’t begrudge the people who have bloody well worked and got there and done it. Who would do it again given the opportunity.”
If it was all about money, she says, “why didn’t Bill Cullen retire at 65, when he got the lump of money from Renault? Why didn’t he go off to Florida and put his feet up and feck the rest of them? He loves to work. That’s what he has done since he was eight. He wouldn’t know what to do if he didn’t have work. His attitude was always ‘sure something’ll turn up’. There may be just a little lack of reality there but that’s his DNA and that’s what keeps him going.”
Did Bill contribute to his own misfortune?
“I feel he was too soft with the banks. He didn’t fight enough against them. He allowed other people to interface too much with them instead of doing it himself. He always had the impression ‘sure they won’t do that to me’. Bill thinks that people think like him. And they don’t.”
