One-time richest man in Ireland declared bankrupt

Throughout the downturn, readers were festooned with sob stories of billionaires becoming mere millionaires, of Wall Street bonuses including seven figures of stock options but just, my word, six figures in cash compensation.

As Regular Joes worried about when layoffs and car repossessions might come, this was the last thing anyone paid much mind. After all, most of the rich that’ve lost big in the recession or afterward got it back soon enough, anyway.

Here’s a story of a man, though, who has been nearly wiped out by the banking crisis in his home country.

His name is Sean Quinn, and with a 2007 fortune of $6 billion, he was once Ireland’s richest man. Today, in a court in Dublin, Quinn was declared bankrupt.

Quinn, the construction tycoon, was handed his ruling in an Irish court Monday as banks pursue debts exceeding $2.7 billion.

*Bing: Who is the richest person in Europe?

Reportedly, Quinn, who testified to as much back in November, has less than $15,000 in cash to pay off his lenders.

In Ireland, the story of Quinn is famous. At 14, he left school “barely literate,” according to the Associated Press, and started his first construction gravel business on a $150 loan.

Within three decades, his rags-to-riches tale was well-known across the country, though his apparent downfall may soon become as notorious as his rise.

How’d Quinn lose his cash? Well, not like you might think.

In 2007, the construction mogul sunk much of his $6 billion fortune into the former Anglo Irish Bank, which would later be found to be one of the country’s most reckless lenders.

By 2008, Quinn and his family had built up a near 30 per cent stake in the bank, and as Anglo’s share price began to sink, the bank allegedly encouraged Quinn to borrow more cash to buy up more of the lender’s stock.

Of course, Anglo continued to lend what it would never recoup, and Ireland nationalized the bank in 2009 to prevent its collapse. Quinn’s investment, estimated at nearly $3.5 billion, was wiped clean.

The 64-year-old and his five children have filed a suit to have their Anglo debts voided under the grounds the bank never should have lent them money in the first place.

By Jason Buckland, MSN Money

Posted at 12:51 PM in Current affairs | Permalink