Q1. What, in simple terms, is the application about?
The application has two main purposes
- To seek directions of the Court as to the manner in which the pooled client assets, including recoveries of misappropriated monies, should be reconciled and distributed to Clients; and
- To seek an order of the Court allowing the reasonable costs of the work involved reconciling and distributing client assets to be deducted from the pooled client assets where the assets of the Company have been exhausted.
Q2. Why is the application necessary?
The application is necessary for a number of reasons but principally because;
- Due to misappropriation, there is a deficiency of assets within the remaining pooled client assets to meet all Clients’ claims on those assets. Therefore, a reconciliation is necessary to ascertain the claim of each Client as well as a method for distributing the pooled client assets to Client’s. If one method of distribution is chosen over another, this has the potential to adversely impact certain Clients or groups of Clients. Therefore, the directions of the Court are required to determine the approach to be adopted.
- The assets of the Company are insufficient to meet even the lowest estimated cost of completing the above work therefore some contribution from the pooled client assets will be required. Such a contribution can only be claimed by the Liquidator on foot of an order of the Court pursuant to Regulation 158 of the European Communities (Market in Financial Instruments) Regulations 2007 (as amended).
Q3. Will the application be determined by the Court on 15 March next?
No. The substantive hearing of the application will not take place on 15 March 2017 next but will take place at a later date to be determined by the High Court. On 15 March 2017, the Court will consider who should be on notice of the substantive hearing and how the Liquidator should communicate with those parties.
Q4. Can I have my say in the application?
You are free to attend the High Court on 15 March 2017 without prior notice to anyone. However, if you are interested in participating in the Court process, please contact either Eucharia Commins or Cormac O’Connor of KPMG by email at chcqueries@kpmg.ie or by phone on 01 4101405.
Q5. I don’t want to attend at Court but how can I find out what happens?
An update on the application will be uploaded to this website shortly after the first hearing on 15 March 2017. The website will then be continually be updated on an on-going basis as the application progresses.
Q6. When will this process end so that I can get a return of my assets?
The Court expects to be able to determine the application during the course of 2017. However, this is not certain and will depend on the legal arguments made by the representative parties during the course of the application. Once the application is determined, the timeframe for reconciliation and distribution of pooled client assets is between 12 months and 2 years depending on which mode of reconciliation and distribution are directed by the High Court. The other factor is the timing of the recovery of misappropriated monies from the property funds. This may take longer than the timeline indicated above. The Liquidator will seek to return client assets as expediently as possible once the application is determined.
Q7. It was reported in the press that the Liquidator is returning €130 million to clients. Is this correct and when will this happen?
The current value of remaining assets held by the Company on behalf of clients is estimated at approximately €173 million. The Liquidator will not be in a position to begin to return those assets to clients until the Court application has been determined as outlined at Q6 above. In addition, a significant proportion of the value of the remaining client assets is held in property investments which are illiquid and may take some time to realise. Further, the value of the assets may fluctuate with market conditions.
