Liquidator appointed to CHC after report
In their report the inspectors said this misuse of client’s assets was deliberately disguised through the use of false accounting entries and the issuing of false and misleading statements to clients.
CHC, which has about 1,400 clients, “deliberately adopted and pursued processes, policies and procedures that facilitated misconduct”, the report states.
The Central Bank sought the appointment of the inspectors, Noel Thompson and George Treacy, last July to conduct an investigation into the affairs of the firm and assess its financial position, as there were significant concerns about its operation.
Yesterday, the High Court made an order for the publication of the report
Mr Justice Gerard Hogan, who said the report described “a sort of an Irish Ponzi scheme”, ordered that copies be sent to the Justice Minister, the Director of Public Prosecutions, the Director of Corporate Enforcement and the Garda.
Following an application by David Barniville, SC for the Central Bank, the judge confirmed the appointment of Kieran Wallace, chartered accountant of KPMG, as liquidator to act as administrator of Custom House Capital.
His appointment was sought as the firm has been found to be insolvent and unable to pay its debts.
Counsel said the appointment of a liquidator was to protect the immediate and ongoing interests of CHC’s clients.
The inspectors state that CHC’s board of directors and senior management “failed in their duties to clients and allowed the company operate with inadequate controls over a significant period of time”.
The inspectors said that an exact figure could not be placed on the amount of client money taken directly and indirectly by CHC and placed into property investments without a detailed examination of clients’ holdings.
However, the inspectors said that it was clear that in excess of €56m was used in this manner.
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