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A COMPANY SET up to pay out compensation has hit out at the long wait faced by many people to get some recompense from what was described as “a sort of Irish Ponzi scheme”.
Custom House Capital (CHC) purported to be a high-end wealth management business aimed at well-off pension investors such as doctors and lawyers. Harry Cassidy, a respected figure in Dublin financial circles, served as the company’s CEO.
However, it was put into liquidation in October 2011 after it was found that it was “systematically and deliberately” misusing more than €56 million of its clients’ assets and cash.
The money was moved to property syndicates, mainly in Germany and France, without investors’ knowledge.
At the time, High Court judge Justice Gerard Hogan described the business as ”a sort of Irish Ponzi scheme”. Last week, the court ruled that Cassidy would be disqualified from acting as a director of a company for 14 years.
About 2,000 people applied for compensation after the company was liquidated, however the body tasked with handling payouts, the Investor Compensation Company Limited (ICCL), admits the process is taking too long.
‘Unsatisfactory’
In its annual report, released today, the ICCL – an independent body set up to pay as much as €20,000 to investors when a firm is unable to make its own repayments - said that it received just under 2,000 claims for compensation after CHC was liquidated.
“During the past year, a total of 70 claims were certified by the administrator resulting in compensation of €186,000 being paid to eligible clients of the firm,” it said.
“So far, aggregate compensation of €7.1 million has been paid. However, the fact that more than five years have passed since the collapse of CHC and over 1,400 claims have yet to be certified is most unsatisfactory.
“In many instances, client losses arose from the misappropriation of retirement related investments, which has only served to exacerbate matters for the investors concerned.”
The ICCL said that it is in a position to pay the compensation amounts due “within a number of days” after the claims have been certified as legitimate by the CHC liquidator.
It said that the delays that “are attributable to issues that have arisen in what has proven to be a complex liquidation”.
However, it added: “The unduly long wait for certification of claims was not envisaged when the investor compensation legislation was being introduced.”
Years
The ICCL said that the liquidator has made progress for many of the investors but added that the pooled client assets, a major asset class that was the subject of a “very significant level of embezzlement”, remain to be dealt with.
“The liquidator has indicated that the reconciliation of these accounts is a complicated exercise because of the manner in which investors’ funds were misappropriated and used to part fund the acquisition of properties,” it said.
“The final level of distribution to the clients in the pooled assets, and the compensatable losses involved, can only be ascertained when the associated properties are sold and recoveries of misappropriated funds determined.
“That process is likely to take a number of years to complete. The ICCL will continue to seek progress in the certification of claims.”
‘Disappointed’
ICCL chairman Jim Bardon said he is “disappointed” that relatively little headway was made on outstanding compensation claims in the CHC case during the year.
“Notwithstanding the complexities arising in the liquidation of this firm, the prolonged wait endured by the eligible claimants concerned was never envisaged in investor compensation legislation,” he said.
“The ICCL has proposed to the liquidator that, where possible, he should consider certifying the claims on an estimated or interim basis in order to accelerate the process.”
The ICCL was set up in 1998 after EU laws were introduced to provide a minimum standard of investor protection across the European bloc.
Written by Paul O’Donoghue and posted on Fora.ie
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Couldn’t trust any kind of pension in this country except a TDs pension! all going south ,very little return .
Where was the Central Bank in all this?
@Ed Cotter:Playing monkey in the middle with the Financial Regulator with prudence conservatism and fairness as the ball and the citizen/taxpayer as the monkey. As was I’ve no doubt the original plan since Dee Dirt Bert presided over the separation of regulatory functions between the Bank and the Regulator, who we know now was nothing more than a patsy, a useful idiot at best, and a criminal himself at worst.
@Ed Cotter:
“Where was the Central Bank in all this?” where are they now all retired on inflation linked pension that also increase in line with the paid grade they retire at.. The Public Sector, Running Ireland into the ground since 1922…
Fast asleep
So, why isn’t the guy in jail?
Because this is not Iceland. Its amazing what a single letter change can make a big difference between Iceland and Ireland.
@Juan Venegas: I am just back from a 4 day holiday in Iceland. They think we are stark raving mad the way there is no accountability. They call Ireland “PAPA” for some reason and DNA analysis shows Irish blood. They called me “cousin”. It appears our monks were not as pure as they let on. Also there was sea movement between the Danes and Ireland in the 8th and 9th century. Language is Icelandic, Danish and English. They seem a very very contented people
Very expensive but great for a short holiday.
Why should they get compensation?
A fool and his money…….
Because in this world the well off cant be suffering a loss of money.
It’s theft of money, same as robbing someone’s house in a raid or a mugging. He should be locked up like the criminal he is
You can be sure it’s being held up by lawyers and for lawyers.
I read the headline ‘Irish Ponzi Scheme’ and thought they were referring to our banking system. I thought they were talking about us not being compensated as taxpayers.
Boys I boys when are ye going to get it…Ireland only compensates the loosing bond holder….but we are the biggest loosers ……..I’m not just talking about the cash …….the heart and soul has been torn out of this sorry state by faciest cronies who fell back on a pillar of socalism……nanltionalation of banks ……they cronies politions want it everyway
@Upowthat Burke: You don’t need any “ISM” never mind right and left,= go for right and wrong. Of course any system is only as good as the poeople running it and Ireland hates being told the truth. I am afraid to say this cannot ever be change. Thismwill be happening in the year 3,234 AD. There is one thing you can do, do not vote. I am inventing a counselling course to help people abandon the practice of voting. You only encourage them. Stay at home.
That way they can still do it but they have no mandate.
Ah yes god bless the public service pensions money from America that keeps coming fund will never run out as long as state is in existence.!!!!!
Time these types of people faced proper justice,prison,slap on the knuckles encourages others into participating in this white collar crime,no real consequences,like the ordinary Joe soap.its time to enforce the law equally to all criminals.
“Custom House Capital” lol, not the same as “Port Tunnel Mortgages” for anyone with a pulse
While you discuss ponzi schemes remember there are a lot of us trying to alert you all that there are 2 serious ponzi schemes brewing at the moment. 1) Is that climate change is a fraud, hoax. The Commies have coalesced with the Greenies, liberals , to form a mono culture designed to do what failed in the Soviet Union and North Korea.
2) The other is renewable energy by wind, solar or bio mass. This is an elaborate scam, See Patrick Moore of Greenpaece on climate change you tube. See “valmartinireland you tube myth about wind energy” and the Irish Energy Blog.
See can you get a pod cast of BBC Spotlight Northern Ireland last night 6/12/2016 at 10.40pm. That will open your eyes.
Yes we need to ( better later than never) take a lesson from Iceland – http://thebottomline.ie/learning-from-icelandic-economics-banking-crisis-management/
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