A UK Bank provided a £1.5 million loan to a Northern Irish construction business in 2007. The Director, Mr A, provided a personal guarantee to support the loan at that time. The Business, “NI Home Constructions Ltd”, went into Administration 2 years later and following a shortfall in recoveries the bank called Mr A’s personal guarantee towards the end of 2009. Mr A refused to honour the guarantee maintaining that that the guarantee provided referred to a second company which was registered in the Republic of Ireland, “ROI Home Constructions Ltd”.
The case was subsequently heard at the NI High Court which determined that there could be no doubt that there was “no arguable defence” to the Bank’s claim. And that Mr A was liable for the entire £1.5million. Following a number of failed attempts to secure the monies the bank was advised by Mr A that he was no longer in position to repay this debt and no longer had any assets.
In the latter part of 2012 De Vere Intellica was tasked with providing an analysis of Mr A’s financial position to ascertain if there were any assets which may have been purchased with the £1.5 million.
Initially extensive searches in and around Northern Ireland were undertaken to provide a picture of Mr A’s assets both disclosed and undisclosed within his immediate geographical location. These searches indicated that Mr A had created 2 secondary companies prior to the collapse of his business NI Home Constructions Ltd in 2009. Although these companies were showing a modest profit the most interesting detail was how involved his wife had become with these new entities and had in fact become the sole director at the conclusion of Mr A’s court case.
Further research revealed that Mr A had extensive connections within the ROI and De Vere Intellica advised our client that these should be explored with urgency. Searches within the ROI revealed that Mr A had indeed made extensive purchases of land and property during the first quarter of 2008. Market analysis conducted noted that these assets could account for approximately two thirds of the missing funds and we advised our client that notices should be attached to these undisclosed assets as quickly as possible.
Our research had also lead us to believe that Mr A had also invested heavily in corporate and property holdings overseas, specifically within South Africa. Utilising our extensive global connections we were able to establish that Mrs A had been involved in creating a further four corporate entities within this jurisdiction. These entities were then found to connect to a substantial land holding in the north of the country which was earmarked for development by the Government.
We passed our findings onto our client who moved to secure the undisclosed assets and recover the monies due to them through Mr A’s liability.