Today in the pressTuesday 22 January 2013 15.32
INVESTORS HERE LEFT NURSING BIG LOSSES AFTER LONDON SALE - Wealthy and once wealthy Irish investors, including the bankrupt estate of former Anglo Irish Bank chief executive Sean FitzPatrick, have been left nursing losses following a sale of the Woolgate Exchange offices in London. It had been owned by the Irish property syndicate since 2006, reports the Irish Independent. The syndicate included Mr FitzPatrick, one-time attorney general and AIB chairman Dermot Gleeson and businessman Feargal Quinn. The prestigious office building in the City of London was sold for £265m (€316m) by receivers to a Canadian investor yesterday, after long-running efforts to secure a buyer. The property has been in the headlines here in recent months because of confusion for the judge and officials overseeing Mr FitzPatrick's bankruptcy regarding the value of his stake in the property. Mr FitzPatrick is due to be cross-examined in the High Court on the matter later this year. There is no question of information being withheld by Mr FitzPatrick. Instead, the confusion relates to the difficulty for officials of valuing a share in a building that has been in receivership, and where efforts by agents for its lenders to sell the building led to a number of false starts. Yesterday's sale for less than the amount of loans secured on the property means that confusion is at an end. That's because it will finally crystallise losses for the syndicate of well-heeled Irish investors who bought the Woolgate for £325m (€386m) in 2006, with loans from Anglo Irish Bank.
CHC BOSS SEEKS TO OVERTURN FREEZING ORDER - The former chief executive of failed investment firm Custom House Capital is seeking to overturn court orders freezing a number of bank accounts containing €180,000. The Irish Times says that Harry Cassidy wants to challenge orders obtained by the Garda in July 2012 freezing two accounts with Bank of Ireland. The accounts are held by a private pension trust with two independent trustees established in 2000 to administer Mr Cassidy’s pension and he is the sole beneficiary, the court heard. He claims the freezing orders were made in judges’ chambers and not in open court, but gardaí have failed to give him the full information to challenge the orders. He claims the freezing orders should have been made in public and the failure to give him all the information used to obtain them is unlawful and contrary to fair procedures. Custom House Capital was wound up in 2011 after a High Court-appointed investigation by two Central Bank inspectors. That probe found “systemic and deliberate misuse” of €66 million of client money through false accounting to hide the transfer of the money to cover shortfalls in European property investments. The inquiry found “improper transactions” concerning €56 million in client funds and €10.4 million owing to clients on an investment bond.
WEIDMANN WARNS OF CURRENCY WAR RISK - The erosion of central bank independence around the world threatens to unleash a round of competitive exchange rate devaluations, which leading economies have so far avoided during the financial crisis, the president of Germany’s Bundesbank warned on Monday writes the Financial Times. Jens Weidmann, whose institution’s own fierce independence from political influence was the model for the European Central Bank when it was founded, said Stephen King, the chief economist at HSBC, was “perhaps right” in forecasting an end to the era of central bank independence. “It is already possible to observe alarming infringements, for example in Hungary or in Japan, where the new government is massively involving itself in the affairs of the central bank, is emphatically demanding an even more aggressive monetary policy and is threatening an end to central bank autonomy,” Mr Weidmann said in a speech in Frankfurt. “Whether intended or not, one consequence could be the increased politicisation of the exchange rate,” he said, according to a text of his speech provided by the Bundesbank. “Until now the international monetary system got through the crisis without competitive devaluations and I hope very much it stays that way.” Both the Bundesbank and later the ECB were founded on mandates that gave them wide powers and freedom from political interference in return for focusing solely on keeping inflation in check.
SUPERMARKETS OMBUDSMAN AIMS TO STOP BULLIES - The first ombudsman designed to crack down on the big supermarkets bullying suppliers in the £163 billion grocery sector has been named by the UK government, says the London Independent. Christine Tacon, who ran the Co-operative group's farming business for 11 years, will have the power to fine the UK's 10 biggest supermarkets, including Tesco and Asda, with turnover above £1 billion, as the groceries code adjudicator. But industry experts are sceptical about whether her appointment will deliver change, as no supermarket has ever been fined by a government body for mistreating a supplier. Ms Tacon will hold the post for four years, although she will not officially take up the role until the revised groceries code adjudicator is passed by Parliament later this year. In a case of poacher turned gamekeeper, she will be paid a salary of £69,000 and will work for three days a week.