High Court block property sale pending case against Cerberus

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Posted in:Banking and Finance|September 25, 2015 | Join the mailing list

Irish businessman Gareth Graham has been granted a stay in the enforced sale of a property development in Belfast thanks to the High Court.


In a complicated case now being discussed by American law enforcement, Mr Graham’s onetime colleague Frank Cushnahan
worked with Mr Graham’s family bookmaking business before their relationship broke down in 2008. Mr Cushnahan retained a 5% share in the property business.

Nama – the bad bank

Loans held by the property business were then moved into Nama, the National Asset Management Agency, which acts as a ‘bad bank’. Created in 2009 by Irish government, Nama’s
purpose is to separate high risk assets and isolate them from the balance sheets of ‘good banks’ following the financial crisis and the subsequent collapse of the Irish property market.

Mr Cushnahan was later appointed as an adviser to Nama, and according to Mr Graham didn’t declare a conflict, although Mr Cushnahan says this is due to an administrative

Cerberus and beyond

Nama then sold the loans held by the property company to Cerberus, a US property investment firm set up in 1992 who focus on ‘distressed investing’.  Cerberus appointed
EY as administrators to recover funds through the sale of property owned by Mr Graham’s company, namely the well-known Lyndon Court development in Belfast.

From Ireland to America

Pending the outcome of a case that Mr Graham is bringing against Cerberus in January 2016, the High Court have determined that the sale should be frozen.

Mr Graham says the appointment of EY as administrators was not valid, and is thought to be in the US discussing complaints he has regarding Cerberus with law enforcement

The case Mr Graham is bringing against Cerberus is due to be heard next year. If unsuccessful, Mr Graham will be liable to any losses incurred as a result of delaying the
sale of the Lyndon Court development.

If there are any issues in this update or more generally that you would like to discuss, please contact one of our Banking and Financial Regulatory team on 0161 829 2599.

(The information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by berg or any of its partners or employees. Professional legal advice
should be obtained before taking, or refraining from taking, any action as a result of this article.)

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