Revenue has opened its most serious form of investigation into Altada, the Cork-based artificial intelligence company that collapsed into receivership and liquidation in late 2022, creditors of the company learned this week.
In a report circulated on Thursday afternoon and seen by The Irish Times, liquidator John Healy of Kirby Healy Chartered Accountants in Dublin informed creditors that the tax authority has initiated a “level 3” investigation into the affairs of the business.
It defines a level 3 investigation as “an examination of a taxpayer’s affairs” where Revenue believes “that serious tax or duty evasion may have occurred, or a Revenue offence may have been committed and may lead to a criminal prosecution”.
Mr Healy also raised several “matters of concern” about the conduct of the directors of Altada, including Allan Beechinor and Niamh Parker, the husband-and-wife duo who co-founded and led the company.
The liquidator’s concerns, which he said are “all contested by the directors” and which he understands they intend to “fully dispute”, include the “potential inappropriate use of company funds” to charter private jets, pay for first-class flights and five-star accommodation and “large transfers to connected companies controlled by the directors”.
They also include an alleged “failure to discharge fiduciary taxes” due to Revenue.
Revenue has submitted a claim against Altada for more than €2.1 million, comprising a preferential creditor claim for €1.6 million, including interest, and an unsecured claim for more than €490,000.
Revenue’s claim is understood to date back to February 2020, just three months after Altada exited a High Court-appointed examinership process in late 2019 in which almost €1.8 million the company owed to creditors was written off.
In his report, Mr Healy said it was evident from the company’s financial statements that Altada had lost money in each of 19 consecutive months from April 2021 to October 2022 to a total of almost €9.6 million. This means it was defaulting on its creditors, including Revenue, just three or four months after it exited examinership.
Mr Healy also revealed to creditors on Thursday that he is considering asking the High Court whether a file should be prepared for the Director of Public Prosecutions (DPP).
He also told creditors that a separate garda investigation, led by detectives attached to the State’s white-collar crime agency, the Corporate Enforcement Authority (CEA), is understood to be ongoing and he is fully co-operating with those efforts.
Whether the directors face sanction or not is a decision for the CEA once the liquidator’s final report is furnished, Mr Healy said in the update on Thursday. However, he said the High Court was entitled to direct a liquidator to “refer matters to the DPP and the CEA if it appears to the court” that a director “has been guilty of an offence in relation to the company”.
Creditors were told on Thursday that Altada had racked up losses totalling more than €10 million at the time the winding-up petition was issued in court. When that figure is added to the €11.5 million the company raised in a funding round in September 2021, putting it on track to achieve a $1 billion (€960 million) valuation, the total deficit to shareholders and creditors is €21 million.
