Court freezes assets of Eden College directorsFriday 13 June 2014 22.37
The High Court has made orders freezing assets of directors of a third level college that ceased trading several weeks ago.
The orders were sought by the liquidator of Eden College, Mr Anthony J Fitzpatrick, against Mr Fakir Hossain and his wife Ms Hasina Akter.
They were sought due to fears that €403,000 in monies allegedly owed to creditors, including hundreds of Eden's former students, maybe transferred out of the country.
Yesterday, at the High Court, Mr Fitzpatrick secured a number of temporary injunctions, under the 2001 Company Law Enforcement Act preventing the couple from reducing their assets below a value of €403,000.
The injunctions were granted by Mr Justice Anthony Barr on an ex-parte basis, where only one side was represented in court.
The judge adjourned the action to next Wednesday's sitting of the High Court.
Barrister Ronnie Hudson Bl, for Mr Fitzpatrick, told the court the freezing orders were required "as a matter of urgency."
The liquidator's investigations had revealed that more than a dozen withdrawals of "lump sums" totalling €403,000 were made from the company's bank account.
These withdrawals occurred between September 2012 and February 2014.
Counsel said while it is not yet known where the money went the liquidators say the monies were not used to discharge legitimate debts owed by the company.
Mr Hossain, a native of Bangladesh who has no other business interests or income in Ireland, was the sole signatory on the company's bank account, counsel said.
It is the liquidator's belief that Mr Hossain withdrew the amounts, to the detriment of the company's creditors.
If these monies are removed or transferred elsewhere the chances to recoup some of the money may be lost, counsel said.
It was in the best interest of the college's former students and other creditors that orders freezing the asset of both Mr Hossain and his wife be granted he added.
As well as the injunctions the liquidator also seeks orders compelling the couple to pay back the €403,000 allegedly taken from the companies' bank account.
He also seeks a declaration the withdrawals by Mr Hossain represents a fraud on the creditors of Eden College.
Eden College, based at Dublin's Burgh Quay, closed in April.
The college blamed its closure on cash flow difficulties following its suspension, pending an investigation, from a register of approved colleges by immigration authorities.
Approximately 1,200 students, mainly non-EU nationals, were enrolled at the college.
Following a creditor's meeting on 23 May, Mr Fitzpatrick, who was nominated by the company's owners, was elected as liquidator.
In a sworn statement to the court, Mr Fitzpatrick said the current directors took over the company in November 2011.
Accounts for the first two years showed the company enjoyed "great success." and it reported a profit for the year ending 2012 of €371,000 with cash in the bank of €66,000.
However, the severe level of financial difficulties experienced by Eden College in May of this year were so great a decision was made to wind up the company.