Once-richest Irishman declared bankrupt on wrong bets with CFD´s

[ASusilovic]

Sean Quinn, three years ago listed as Ireland’s richest man, has been declared bankrupt in a Northern Ireland court over alleged debts of €2.8bn to the Irish state-owned lender Anglo Irish bank.

The 64-year old businessman’s insurance, cement and property empire collapsed last year following a multibillion euro stock market gamble on the share price of Anglo, which was nationalised during Ireland’s banking crisis.

Mr Quinn said in a statement on Friday he couldn’t pay the loans due to Anglo but added that the vast majority of the debts to the bank were “strenuously disputed”.

“I cannot now pay those loans which are due, following Anglo taking control of the Quinn Group of companies, which I and a loyal team spent a lifetime building, and I find myself left with no other alternative,” he said.

Mr Quinn accepts he owes Anglo almost €200m for property and other loans advanced during the property boom in Ireland. But he disputes the rest of the debt, which relates to his use of contracts for difference (CFDs) to buy Anglo shares.

CFDs, which are an anonymous form of investment, enabled Mr Quinn to bet on Anglo’s share price without buying the shares outright. He initially funded the bets with a loan from the Quinn Group in 2007, but when the bank’s share price began falling sharply, Mr Quinn was advanced loans by Anglo to cover the position.

http://www.ft.com/intl/cms/s/0/7c86e246-0c76-11e1-8ac6-00144feabdc0.html#axzz1dCkKJbrU

 

[Free Thinker]

Quote from ASusilovic:

Sean Quinn, three years ago listed as Ireland’s richest man, has been declared bankrupt in a Northern Ireland court over alleged debts of €2.8bn to the Irish state-owned lender Anglo Irish bank.

The 64-year old businessman’s insurance, cement and property empire collapsed last year following a multibillion euro stock market gamble on the share price of Anglo, which was nationalised during Ireland’s banking crisis.

Mr Quinn said in a statement on Friday he couldn’t pay the loans due to Anglo but added that the vast majority of the debts to the bank were “strenuously disputed”.

“I cannot now pay those loans which are due, following Anglo taking control of the Quinn Group of companies, which I and a loyal team spent a lifetime building, and I find myself left with no other alternative,” he said.

Mr Quinn accepts he owes Anglo almost €200m for property and other loans advanced during the property boom in Ireland. But he disputes the rest of the debt, which relates to his use of contracts for difference (CFDs) to buy Anglo shares.

CFDs, which are an anonymous form of investment, enabled Mr Quinn to bet on Anglo’s share price without buying the shares outright. He initially funded the bets with a loan from the Quinn Group in 2007, but when the bank’s share price began falling sharply, Mr Quinn was advanced loans by Anglo to cover the position.

http://www.ft.com/intl/cms/s/0/7c86e246-0c76-11e1-8ac6-00144feabdc0.html#axzz1dCkKJbrU

rich people should be the most conservative investors.

 

[denner]

Quote from Free Thinker:

rich people should be the most conservative investors.

But therein lie the irony...the sort of wealth that is created nowadays (on the back of massive asset inflation) requires enormous risk taking (even though I'd argue many of the people who had taken the risk didn't really realize the enormity of risk undertaken).

 

[oddsman]

there's gotta be an irish joke in here somewhere.

 

[nazzdack]

Quote from ASusilovic:
----Sean Quinn, three years ago listed as Ireland’s richest man....
----bankrupt....
----The 64-year old businessman’s insurance, cement and property empire.....
----multibillion euro stock market gamble....
----Quinn Group of companies, which he spent a lifetime building....

When "traditional" businesspeople get excited about the stock market, be careful.

 

[ASusilovic]

Quote from nazzdack:

When "traditional" businesspeople get excited about the stock market, be careful.

Nazz,

where did you hide? Missed your comments...

 

[denner]

FWIW, Ireland's housing debacle is something that defies description. You'd also be absolutely stunned if you heard some of the prices paid for spec plots of land at the peak of the bubble. Dublin has so many "ghost estates" that it would take successive generations to reach full capacity, something that will never happen since so many people continue to emigrate from Ireland. A complete disaster.

 

[newwurldmn]

Quote from Free Thinker:

rich people should be the most conservative investors.

They generally are. But some I guess have made so much money taking risks, they never stop until it stops for them.

 

[nazzdack]

Quote from ASusilovic:

Nazz......

I had a goofy schedule and needed to get away for a bit.

 

[Ghost of Cutten]

Quote from denner:

FWIW, Ireland's housing debacle is something that defies description. You'd also be absolutely stunned if you heard some of the prices paid for spec plots of land at the peak of the bubble. Dublin has so many "ghost estates" that it would take successive generations to reach full capacity, something that will never happen since so many people continue to emigrate from Ireland. A complete disaster.

Yet prices right now are not bargain basement. Not expensive, but hardly screaming bargains either. Try to rent a decent city centre apartment in Dublin for <1k euros.