THE DUBLIN businessman Breifne O'Brien, who was ordered by the High Court on Monday not to reduce his assets below €20 million, is a director and shareholder of a subprime mortgage business in the UK that went into administration earlier this year.
The business launched in 2007 and was processing mortgages valued at £20 million per month before becoming victim to the credit crunch, according to filings in Companies House in London.
Mr O'Brien is one of two directors of Go Commercial Ltd, a London holding company that is the sole shareholder in Go Business Mortgages Ltd, a company incorporated in September 2005 and which went into administration in July.
It had accumulated losses of £6.1 million in May of this year, more than £5 million of which was owed to the holding company.
Mr O'Brien holds 88,595 of the two million issued shares in the holding company. He could not be contacted yesterday.
On Monday, Mr Justice Peter Kelly in the Commercial Court granted an order prohibiting Mr O'Brien from reducing his assets below €20 million after the court was told he had secured supposed investments from friends and associates that had not been invested as promised but had instead been used by Mr O'Brien for personal expenditures and other matters. There is no suggestion that these matters have anything to do with the UK business.
Mr O'Brien, of Invergarry, Silchester Road, Glenageary, Co Dublin, is a director of a number of taxi and laundry companies in Dublin. The accounts of the companies do not record turnovers or profits of any substance. However, the mortgage business with which he was involved in the UK has substantial sums in its accounts.
Mr O'Brien is a director of Go Commercial, along with Andrew Jonathan Strode Gibbons, of Chilworth, Southampton, the ultimate controlling party of the company, according to its accounts. The accounts, for the year to end December 2007, show it made a loss of £2.9 million and had accumulated losses of £4.7 million. The share capital was £5.1 million.
The company's sole subsidiary, Go Business Mortgages Ltd, was put into administration in July. According to filings by the administrators, a £1 million investment in the holding company by an investor, Commercial First Mortgages, valued the company at £11 million.
Following a major advertising campaign in 2007, the business was lending circa £20 million per month, according to the administrators. "Commercial First was the company's main lender and the company directly advertised to the sub prime market as these were the products that Commercial First offered."
The company "started to experience difficulties during the early part of the credit crunch in September and October 2007 which resulted in the management making cost savings throughout the business".
By March 2008 the company was no longer receiving loans from Commercial First, according to the administrators. Other lenders charged higher commissions and by the end of June it was evident that, despite cost reductions, the business could no longer trade.
