Ex-director ‘refused to transfer shares’

A former director of property investment business Tuskar Asset Management plc (Tam) has refused to transfer shares in a Bulgarian company to the Tam liquidator despite repeated requests to do so, a disciplinary hearing of the Chartered Accountants Regulatory Board was told yesterday.

Liquidator Neil Hughes said he believed the asset, a Bulgarian company that in turn owns a development site on the Black Sea, belonged to Tam. But the shares were held in the name of former Tam director Alan Hynes and his wife Noreen.

Mr Hughes was giving evidence on the first day of the board’s disciplinary hearing investigating complaints against Mr Hynes, a Co Wexford businessman and accountant, who was the driving force behind Tam, which collapsed in 2009.

The liquidator said the 2007 annual report for Tam referred to the purchase of the four-acre property in Bulgaria, which was purchased for €500,000.

He said the asset was “clearly an asset of the company”, but the shares in the Bulgarian company continue to be held by Mr Hynes and his wife. This was savings and pension money entrusted to the plc, he said.

He told Brian Farren, for the regulatory board, that €3.1 million of shareholders’ funds had not been adequately accounted for or its whereabouts explained.

The hearing was told Mr Hynes had said a contract associated with the Bulgarian property had been rescinded since the 2007 accounts but he, Mr Hughes, found this “completely unacceptable”. The issue was “an example of the lack of co-operation I have received from Mr Hynes to date”.

He said not all of the money given by investors to Tam had ended up with the company.

His work on the liquidation had involved writing to all the investors and getting them to source copies of their cheques from their banks so he could see where their investments had gone. He said he found that €3.1 million had gone into companies or partnerships associated with Mr Hynes and his wife.

He had also found €2 million purportedly used to invest in Tam assets in fact came from a bank loan on a property not associated with Tam, which had been mortgaged twice. A second mortgage issued to pay off the first had not been used for that purpose.

The hearing also heard that investors gave powers of attorney to Mr Hynes, which were then used to give personal guarantees to banks. He had seen a list of shareholders’ names appended to an Ulster Bank guarantee for €2 million, which was then signed by Mr Hynes.

Mr Hughes said that, although Tam’s only audited accounts, which were for 2007, audited by Deloitte, the firm had only audited the holding company and not the Tam subsidiaries.

He had held meetings with Deloitte and had been told that Mr Hynes had given misleading information to the firm.

The hearing is to continue today.