Wednesday, January 19, 2011
Come with me once again down the rabbit hole well trodden by Irish property developers and their enablers in Irish banks and the Irish state bodies.
Our hero today is Killiney solicitor Brian O'Donnell, a man who somehow managed to leverage his business in just over a decade to the point where he was buying Washington skyscrapers overlooking the White House, entire buildings in London's Canary Wharf and Stockholm's biggest office block.
Of course, the money for these nine-figure purchases was largely borrowed from banks. And now they'd like it back. Bank of Ireland is looking for around €70 million from O'Donnell and his doctor wife. But that's dwarfed by their total property debts of over $1 billion.
So far, so Celtic Tiger collapse. But what's especially hallucinogenic about this case is not only the massive amount of money that the banks leant to a lawyer and a doctor to buy skyscrapers all around the world. What's really, really straining the limits of credibility is the fact that our hero is currently on a panel to advise NAMA.
Needless to say, like all good state agencies, NAMA is spunking absolute fortunes of state money at lawyers. The agency is expected to hand over €260 million to legal eagles over the course of the next decade. That's a quarter of a billion euro of OUR MONEY.
And who are these incredibly expensive legal advisors? Well, 64 firms have been appointed to a panel to share the booty. And unbelievably, Brian 'Billion in the hole' O'Donnell is one of them.
Let us pause for a moment to catch our collective breath at this audacity.
Somehow a lawyer managed to persuade the banks to loan him not a few hundred grand for a couple of buy-to-lets, nor even a couple of mill for an apartment block, but one BILLION dollars for skyscrapers.
Then it all went tits up for property, and now the banks want their cash back and are suing to get it. O'Donnell being a lawyer, is obviously fighting it. Fighting in court is what he does well, unlike investing in property.
Meanwhile, the state via it's impaired bank loans vehicle NAMA is doing the best it can to bail out the poor developers and the banks who got burnt went property went poof.
And of course, this is inevitably a bonanza for lawyers, as all state agency activities tend to be. But the incredible chutzpah, the sheer gall of all involved to appoint a lawyer to this advisory panel, which will pocket quarter of a billion in fees, who himself got spectacularly burnt and is in debt to the tune of $1 billion on property, is staggering.
Let's go over it one more time, real slow: NAMA has decided it is appropriate to take legal advice on handling their crappy property loans from someone who themselves owe a billion bucks to the banks on property deals.
They're either mad as a hatter, or they've been chewing on the wrong side of the mushrooms. And they've obviously stopped even caring about what they do or how it looks to us poor pleb mugs who just had our entire futures mortgaged to the IMF to pay for all of this mess.