Central Bank says Cork broker not able to meet debts

A Central Bank investigation into a Cork brokerage firm has concluded that it will not be able to meet debts owed to clients.

The amount of money missing in relation to Andrew Casey Life and Pensions is not known, though complaints involving a total of about £300,000 are understood to have been made to the Garda Fraud Squad.

The outcome of the Central Bank's inquiry will now be forwarded to the Investor Compensation Company, which will in turn contact clients of the brokerage and inform them of their rights under the Investor Compensation Act, 1998.

Clients will then have five months within which they can make claims for compensation.

The decision in relation to the Cork brokerage is the second time such a determination has been made by the bank since the compensation procedure came into existence. The previous instance was in relation to Money Markets Stockbrokers Ltd (MMI), which is in liquidation.

A final figure on the amount missing as a result of the activities of the Cork brokerage is likely to emerge once all the claims for compensation have been received.

In August the Irish Brokers' Association expelled Mr Casey following allegations that funds placed with him had gone missing. Mr Casey failed to turn up at disciplinary hearings held to consider the matter, having told the association that he was ill. He also failed to reply to the association when it outlined in correspondence the accusations which were being made against him.

Mr Casey was not available for comment yesterday. Allegations against him came to light in July when a couple became concerned about £28,500 they believed they had invested in Irish Life through Mr Casey. They secured an injunction against the broker in Cork Circuit Court after Irish Life confirmed it had no record of the funds. The company has since cancelled its agency with Mr Casey.

Some of the complaints to the Garda are understood to concern investments going back to the earlier part of the 1990s.

Under the Investor Compensation Act, introduced last year, the Investor Compensation Company can compensate investors whose funds have been misappropriated. Eligible investors are entitled to compensation of 20 per cent of the sum lost, or £15,571, whichever is the smaller sum.

The Department of Enterprise, Trade and Employment has ultimate responsibility for insurance intermediaries. A spokeswoman said the Department had been given the details of the IBA inquiry into Andrew Casey Life and Pensions and decided that, having regard to the garda inquiry and the existence of the investor compensation scheme, that it would take no further action in relation to the matter.