Irish investors may not know they lost money after Dolphin Trust collapse
The corporate headquarters of German Property Group, formerly called Dolphin Trust, in Langenhagen, Germany. Picture: Alexander Koerner/Getty Images
Hundreds of Irish people may have unknowingly invested in the now-collapsed German Property Group, and do not realise they have been "burned", a solicitor representing affected clients has said.
The collapse of the German Property Group, formerly called Dolphin Trust, which went into insolvency administration in Bremen last year, put into question more than €1bn the German firm had collected across the world, including Korea, France, and the UK, as well as in Ireland.
Brokers sold products to 1,800 Irish clients through unregulated loan notes which were then invested in developing residential German properties.
Carrie McDermott, who works for MDM Solicitors in Cork, said the investment firm changed its name several times in recent years, causing confusion among investors about which company their money is with.
Ms McDermott said there are also situations in which investors completed a risk questionnaire, and let the broker decide where best to invest the money, meaning the investors may be unaware of where the funds were invested.
"It looks like most of the customers or clients are your average Mr Murphy or Ms O’Sullivan,” she said.
MDM Solicitors is currently representing 21 clients, including a solicitor who works there, who were affected by the issue. The firm also receives enquiries daily from people who may also have been affected.
Ms McDermott’s clients have lost between €35,000 and €180,000, either through a single direct investment or via their pension.
"I’ve a man who got €50,000 from his mother’s inheritance and he put every single penny into it, thinking that was money he would have for his kids when he was dying,” she said.
Investors have no recourse to the Central Bank-run investor compensation, as these are not regulated products, Ms McDermott said.
MDM Solicitors has received instructions from clients to pursue action against a number of parties involved in the creation and selling of the investment fund.
“The question is for any individual punter who has invested is did they invest in trust and confidence in a broker who didn’t give them the information, and if that’s the case they are going after the broker," she added.
Last month, a 78-year-old woman from Cork, Kathleen Dineen, won a High Court petition for the winding-up of an Irish-based company that helped raise a total of €107m from investors in Ireland on behalf of the German property group.
The order involved an Irish-registered company, MUT 103, which was one of the investment vehicles used by the Irish distributor Wealth Options Trustees Ltd.
The funds were put into the MUT 103 company and another vehicle called MUT 116 on behalf of the Germany Property Group. MUT 116 has not yet been wound up, though its future is being examined.
CONNECT WITH US TODAY
Be the first to know the latest news and updates
