Liam O’Reilly was the Property Fund Administrator with Custom House Capital when the company was engaged in false accounting and fraudulent trading.
I have been assured by the Financial Regulator that this is not the same Liam O’Reilly who once held the position of Financial Regulator.
Here’s some of Mr. O’Reilly’s evidence.
Liam O’Reilly – Property Fund Administration – 3pm on Monday 18 July.
4.2 Sworn testimony to Inspectors.
The witnesses called by the Inspectors were asked to describe the Destiny structure, comment on whether they were aware of a process whereby funds from one sub-trust may have been used to fund the expenses of another or others and asked who authorised such payments..
Further on in the evidence of Mr. Liam O’Reilly
Q. Right. Okay. The problem being some are under water.
A. Exactly. And the money isn’t there. It has been very, very difficult the last few months
Q. All right. Okay. So in the context of I suppose the clients statements in relation to — well, the areas that you’re familiar with, Liam, are — would it be true to say that some of those clients, their unit position there is not really reflecting the true position if — if the pooled accounts were pulled apart?
A. I sign off on them and I stand over it, you know. They’re 100 percent accurate. The issue is, if that client, you know, wanted to sell his property in the morning, and maybe there was a cash balance of 100,000 in one of these accounts, it may be difficult in getting that out.
4.4 Conclusions
The Inspectors are of the view that the practice of using available cash balances on the pooled cash accounts to pay invoices and other expenses of individual sub-trusts, particularly those of the larger commercial/syndicated trusts, was pervasive within CHC for a considerable time.
Unit holders in the affected sub-trusts would not be aware that this was taking place having regard to the pooled nature of the cash accounts and the fact that in any statement issued to them by CHC their holdings in the trusts would be reflected as units held.
As each trust would appear to be a separate legal entity, the problems in resolving this issue will be most acute in relation to those trusts which a) in aggregate owe money to the pooled accounts and other trusts, b) have little cash holdings in their own right and c) have poor or negative cash flows.
A thorough analysis of each trust’s transactions will be required.
Based on the testimony received and the forensic examination the practice would appear to have existed for some time within CHC.
The scale of the problem appears to have increased to some extent in 2011.