7 days ago
- Business
- Irish Independent
Former partner of broker Bloxham is declared bankrupt
The Dublin-based fund manager resigned from the firm in 2006 at the height of the Celtic Tiger, but later became embroiled, along with a number of other former partners, in a legal action launched by an insurance entity that sought to pursue a €4.9m judgment against them.
Bloxham, which operated as an unlimited partnership, went into meltdown in the spring of 2012 when the firm's head of finance and compliance, Tadhg Gunnell, revealed that certain financial irregularities had been hidden over the years.
The firm had 17,000 private clients at the time. In 2015, Mr Gunnell was disqualified by the Central Bank from managing a financial firm for 10 years. He was also fined €105,000. He had been declared bankrupt early in 2015.
After the financial irregularities were revealed at Bloxham in 2012, the Central Bank then ordered it to cease trading, with the firm having a €5.3m hole in its accounts.
In 2021, a Court of Appeal ruling meant that the insurer was able to pursue its application for €4.9m that was allegedly outstanding under a 2011 settlement with Bloxham.
The January 2011 settlement was made in proceedings over heavy losses suffered by the Solicitors Mutual Defence Fund (SMDF) fund after investing in a bond which fell 97pc in value.
SMDF, later R&Q Ireland, claimed it lost almost all of its then reserves of €8.4m due to negligence by Bloxham.
The insurer applied to the High Court in 2020 for leave to re-enter proceedings initiated in 2009 against Bloxham, seeking judgment for €4.9m. Re-entry was opposed by lawyers representing five former Bloxham partners, including Mr Harte.
They argued that a High Court order of January 31, 2011, made when the settlement was announced, meant the proceedings were 'struck out with liberty to re-enter' and this prevented any matter other than the original cause of action being re-entered.
SMDF insisted the proceedings could be re-entered for the purpose of it seeking judgment.
In May 2020, Mr Justice Denis McDonald found for SMDF. In 2021, the Court of Appeal upheld that decision. The case was settled later that year.
Mr Harte has no financial judgments against him.
