24 October 2008

Ireland's richest Man is fined Millions by the Financial Regulator over a shady Loan Affair

On a day that saw many of the world's stock exchanges experiencing the worst declines in their history - with drops of around 10% in most indices - a long-running investigation into business irregularities in Ireland has come to an end.

An insurance company owned by Ireland's richest businessman has been fined a record € 3.25 million by the Financial Regulator in Dublin.

Sean Quinn (photo) who comes from Co. Fermanagh in the North, but has now various business interests all over Ireland as well as abroad, was also fined a sum of € 200,000 as a personal punishment.
He has now stepped down as chairman of Quinn Insurance (formerly BUPA Ireland), following the investigation.

The office of the Financial Regulator said it had "reasonable cause to suspect breaches of regulatory requirements". But it pointed out that the insurance company had fully co-operated and the matter was now closed.

In a statement, the Financial Regulator said the suspected breaches related to contraventions by Quinn Insurance of "obligations under the Insurance Acts and Regulations, including failure to notify the Financial Regulator prior to providing loans to related companies". Policyholders with the firm had not been affected.

It appears that assets worth € 288 million were moved internally from the insurance company to another part of the Quinn Group, in order to support Quinn's purchase of 15% of the shares of AIB bank, which at the time stood at a price of € 6 each. (The shares have meanwhile fallen well below € 1 and besides the fines Mr. Quinn is also facing massive losses in the value of his - rather unwise - investment. But as Ireland's richest man and one of the few Irish billionaires, he will not bee too much bother, one can assume.)

In a statement Sean Quinn said the company "had made loans to a related company which amounted to € 288 million in May 2008", when the accounts were finalised.
"These loans breached insurance regulations and as a result of this the Financial Regulator has sanctioned Quinn Insurance and myself. I accept complete responsibility for this breach of regulation. But while I accept that I made mistakes, I feel that the levels of fines do not reflect the fact that there was no risk to policyholders or the taxpayer. However, we will pay the fines and move on."

Sean Quinn said he would continue as chairman of Quinn Group, which last year made profits of € 433 million - an increase of nearly a third on the 2006 results. It also bought the health insurance company BUPA Ireland, which was then re-named Quinn Insurance.

Quinn and his wife and children own the companies outright and are believed to have in 35 years amassed a personal fortune of nearly € 4 billion. The Quinn Group, which began in 1973 as a small gravel pit on the family farm in Derrylin, Co. Fermanagh, employs now more than 5000 people throughout the world and has recently expanded into India and Russia.

The Emerald Islander

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