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Ireland's political and cultural magazine
12September/October 2015
Controversial
Cushnahan
shared a
directorship
with NAMA
chairman,
Frank Daly,
on an obscure
though
well-funded
Catholic
charity called
Ciorani
“
I
S it possible that the row that has
engulfed the National Assets Man-
agement Agency (NAMA), a leading
solicitors firm and senior politicians in
the North over the disposal of its Project
Eagle portfolio of distressed loans could
spill over to its controversial operations
south of the border?
The involvement of the US Department
of Justice (DOJ) in the on-going investiga-
tions into the sale of the
-property portfolio to New York
based investment firm, Cerberus, has
also cast a long shadow over the intensive
discussions to save the devolved admin-
istration in Belfast.
The Financial Times reported on th
September that the DOJ has served a sub-
poena for information on Cerberus over
allegations that improper payments were
made, or intended to be made, in connec-
tion with its successful acquisition of the
Project Eagle assets for £.bn (€.bn)
last year. The assets of commercial and
residential properties had an estimated
value of £bn when they were taken over
by NAMA.
These allegations were first aired in
the Dáil in July when Mick Wallace TD
disclosed that an audit of Tughans solici-
tors had revealed that a payment of £m
was “earmarked for a Northern Ireland
politician”. Belfast-based Tughans was
engaged by US legal firm Brown Rudnick
which in turn was working for Cerberus
on the purchase.
When Wallace broke the story, Brown
Rudnick confirmed it had “agreed to
share with Tughans our fee from Cer-
berus and this arrangement was
disclosed to both Cerberus and Nama”.
Cerberus has said that it has not been
accused of any wrongdoing in the matter
and welcomes the inquiries. It said that
“these matters are related to the alleged
conduct of third parties and not to Cer-
berus or any of its affiliates”.
The New York firm is chaired by
former US vice-president, Dan Quayle,
and details of his private meetings in
and with then-first minister
Peter Robinson and his party colleague
the DUP finance minister, Simon Hamil-
ton, over the deal have generated angry
exchanges with deputy first minister,
Martin McGuinness. The Sinn Féin
leader in the North claims to have been
unaware of the discussions and of a
memo of understanding sent by Robin-
son to NAMA that helped to seal the
loan-book sale.
Central to the deal which is now under
scrutiny in three jurisdictions is the
former Tughans’ partner, Ian Coulter,
whose sudden departure from the firm
early this year sparked correspondence
to the Northern Ireland Law Society from
the firm.
Coulter diverted the £m fees due to
Tughans to an offshore account which,
Wallace said, was to be used for the ben-
efit of a politician or a political party.
It later emerged that Belfast business-
man, Frank Cushnahan, a former
member of NAMA’s Northern Ireland
Advisory Committee (NIAC), was to
receive £m for his role in brokering a
sale of the assets to another US vulture
fund, Pimco. Cushnahan was recom-
mended for the position with NAMA by
former DUP finance minister, Sammy
Wilson.
Minutes of phone calls revealed by
NAMA to the Stormont committee inves-
tigating the controversy show that
Hamilton informed the agency in
December that both Robinson and
McGuinness had been updated on confi-
dential briefings about the sale of the
portfolio and in particular the bid by
Pimco. McGuinness has rejected the
claim that he was kept informed of the
tender and sale process.
The Pimco bid collapsed after the
suggested £m payment to Cushnahan
was disclosed to the Agency by the US
firm in March , just five months
after he left his position with the NIAC.
Pimco then withdrew from the process.
Its rival Cerberus was awarded the
tender.
Further complicating the inquiries is a
claim by Belfast developer, Gareth
Graham whose family owns Sean P
Graham bookmakers that “inappropri-
ate political relationships and potentially
unlawful banking relationships” are at
the heart of the disposal of lucrative
assets in the North, including his own
distressed loans.
At a dramatic hearing in early Septem-
ber Graham told the Stormont finance
and personnel committee of Cushna-
han’s “malevolent influence” over his
company since he was taken on as an
adviser in and more particularly
since he was appointed to the NIAC in
.
He also claimed that Cerberus have
adopted a “ruthless, unjust and unrea-
sonable” approach towards his company
since it acquired Project Eagle last year.
It has been suggested that Graham has
been targeted for unfair treatment in
comparison with the manner in which
better connected developers and dis-
tressed property owners in the North
have been treated.
It is this type of controversy which
could foster fresh allegations of
improper behaviour by some of the large
number of asset managers, or vulture
funds, that are buying up substantial
loan portfolios from NAMA in Dublin
and other centres across the country in
some cases with developers whose hubris
created the crisis in the first place.
Cerberus has bought up some €bn
in distressed assets in Ireland and across
Europe over the past two years.
Another complication for NAMA is the
revelation that Cushnahan shared a
directorship with agency chairman,
Frank Daly, on an obscure though well-
funded and Dublin-based Catholic
charity called Ciorani, for some years.
Daly has said that his involvement in the
charity is a private matter. •
Allegations about NAMA in North begin to focus attention on disposal patterns in South.
By Frank Connolly
Contagious
NEWS NAMA
resigned: for unrelated reasons
