Drumm’s wife used maiden name for account
That was part of the lengthy testimony given by the disgraced banker on day two of his bankruptcy trial at a court in Boston yesterday under cross-examination from his defence attorney, David Mack.
Mr Drumm was spending a second full day in the witness stand as his lawyer brought him painstakingly through his financial affairs over the five or so years since his departure from the top job at the now defunct bank.
Lorraine Drumm used her maiden name, Farrell, to open an account at Boston Private Bank while the couple also drew up a separate property purchase agreement as she wanted her purchase moneys protected.
It was not to do with “evading creditors”, Mr Drumm insisted. They simply did not want their names on public records
“The media would be at our door within minutes ... We didn’t want to make it too easy for them.”
The testimony also covered his immigration to the US, his attempts to get a new consultancy firm off the ground in 2009 and his attempts to grapple with the US bankruptcy period.
Mr Drumm said he avoided the then “pretty brutal” bankruptcy process in Ireland and instead took on the services of Boston bankruptcy lawyer Stewart Grossman just as his firm, Harborlight, began to experience difficulties.
It became increasingly difficult, Mr Drumm recalled, to consummate deals with investors due to the worsening condition of economy in Ireland and his own association with the former Anglo. Describing Irish bankruptcy at the time as a “debtors’ prison”, he said he had no familiarity with the bankruptcy process in the US but was advised that it was like “getting naked in public”.
“Were you comfortable with getting naked in public?” he was asked.
“Yes,” he replied. “I had no choice.”
Prosecution lawyer John Hutchinson, acting on behalf of IBRC, had accused Mr Drumm on Wednesday of using the $250,000 required for an investor’s immigration visa as a piggy bank for his own lavish lifestyle, a fact strenuously denied by the defendant.
The original business idea for Harborlight was to create a limited partnership fund to purchase distressed property assets while plugging into a network of former clients of his who were “well-heeled” in the financial industry.
Mr Drumm recalled that a representative office set up by Anglo in the late 1990s in Boston ended up as a multibillion-dollar enterprise, “built from scratch”.
It wasn’t, however, an easy decision for his wife Lorraine to go along with.
“She was positive in concept and resistant in practicality ... I didn’t feel I had great prospects in Ireland ... it was a tough time with the loss of the job and the media attention around that. The worry was a bit of a strain.”
Eventually, Mrs Drumm agreed to loan her husband the seed money, a transaction not recorded: “She was my wife, I wouldn’t have thought of doing that”.
When asked by his lawyer if he was aware that a statement of financial affairs was insufficient, he replied “absolutely not” and then when there were questions concerning possible omissions from the schedules, he said he felt “absolutely devastated”.
He added that one of his lawyers, Heather Zelevinsky, “didn’t give me much help” so he “went after” Grossman. “He gave me a padded answer, told me to calm down, said it’s going to be fine ... It was a total disaster”.
