A prominent and extremely wealthy Irish businessman is understood to owe MMI Stockbrokers around £4 million and to also owe substantial but smaller sums to two other Irish stockbroking companies, informed sources have told The Irish Times.

The businessman concerned could not be contacted for an official comment, but informed sources said there was no question of the person concerned defaulting on these debts, and that they would be settled in full when they fall due next month.

The sources added that the businessman's debts were not related to any dealings in Dana Resources under the "rollover" arrangement, which allowed MMI clients to postpone settlement of their account with the stockbroking firm.

There are also unconfirmed reports that the businessman also provided £1 million to tide MMI over the cash-flow difficulties last September, which eventually led to it being taken over by one of its biggest creditors, the London investment group, K&H Options.

Not long after K&H, which was owed £8 million by MMI, took over the stockbroking firm, it emerged that the financial situation was far worse than had been thought.

Last week, MMI finally went into liquidation with total debts of £14 million, with its sole assets being its list of debtors - largely the investors who took advantage of the rollover arrangement to invest in Dana shares.

When these shares fell from over 20p last August to 6p, most of these investors simply refused to pay their debts to MMI. The High Court-appointed liquidator, Mr Tom Kavanagh, of Kavanagh Chartered Accountants, now has the task of recouping these debts.