Finbarr Ross, who was convicted of fraud in Belfast Crown Court yesterday, is not expected to have to serve any of his two-and-a-half-year prison sentence.
The Co Cork-born former financier has already spent two years in prison awaiting extradition from the US and on remand in Northern Ireland. His lawyer said yesterday that he expected Ross to be released next week from Maghaberry Prison and had been instructed to lodge an appeal.
Ross was found guilty yesterday of three charges that he sought and obtained funds for International Investments Limited at a meeting in Belfast on December 15th 1983 when he knew the company was insolvent.
Ross (55) sat impassively in the witness box as the verdict was read out by the jury forewoman who appeared on the verge of tears. When the clerk asked for the verdicts she replied "guilty" in a low voice for all three charges. Mr Ross had difficulty hearing the first verdict and had to ask the prison officer sitting beside him to repeat it. He showed little surprise when it was relayed to him.
International Investments Limited collapsed in 1984 with debts of more than £7 million (€8.9 million). Although most of its clients lived in Northern Ireland IIL was based in Gibraltar. The company was run from Dublin by Ross and also, the court was told, by Mr Frank Murray, a Dublin surveyor. Although the company was subsequently liquidated no money was ever raised for creditors.
Lord Justice McCollum was critical of the way the liquidation was handled when he sentenced Ross. "It seems to me that matters occurred which those involved can be anything but proud about," he said. Mr James Galliano, a Gibraltar-based accountant who was the ultimate liquidator, was "unable to fully supervise things in Ireland" and "may not have been well served" by those working on his behalf in Dublin.
The trial had been told that Mr Declan Collins, a partner in Stokes Kennedy Crowley in Dublin, had been appointed Mr Galliano's agent in Ireland on the recommendation of Mr Colm Allen SC. Mr Allen was the chairman of a committee of inspection established under Gibraltar law to oversee the liquidation.
It was alleged during the trial that many of the company's assets were sold at less than their real value to people connected with the liquidation. Other assets were said to have disappeared during the course of the liquidation and no action was taken against individuals believed to hold company assets. These included two solicitors, Mr Oliver Conlon and Mr Paul Smithwick.
A former member of the inspection committee said yesterday that the liquidator hired Stokes Kennedy Crowley because it was one of the top five firms. Mr Collins was the partner designated by the firm. The accountancy practice had its own legal advisers, independent of the committee.
Mr Collins, who subsequently left the firm, refused to travel to Belfast to give evidence for the prosecution. As a result the prosecution was unable to produce documentation to support its claim that all the assets were so heavily borrowed that they were worthless. The liquidation realised £900,000 (€1,142,764) of which two-thirds went to Stokes Kennedy Crowley.
"The real difficulty was that things which were being represented as assets turned out not to be assets," said the former committee member. The court was told that Mr Murray acted as auctioneer for the liquidator and sold valuable land in Balbriggan, Co Dublin, to his brother at less than it was worth. It was also alleged that a property was sold to Mr Elio Malocco, the former Irish Press solicitor for a knock-down price and he then made huge windfall profits. These allegations were untrue, said the former committee member. A £200,000 bank deposit and loans of £1.2 million were also said to have disappeared out of the liquidation.
There were also allegations that Mr Allen had a conflict of interest when he chaired the committee as he had previously acted for Mr Murray. The surveyor had sworn in an affidavit that he had no role in running the company which was, the court was told, "a lie".
Sources close to Mr Allen said yesterday he adhered to the Bar Council rules on conflicts of interest, including informing the committee of his work for Mr Murray. Lord Justice McCollum also criticised the regulatory authorities in Gibraltar for not taking enough interest in the company. "There was a strange lack of supervision," he said. It is understood that Mr Galliano would not instigate legal action against the Gibraltar government despite the urging of Mr Allen and the committee.
Insp Noel Leckey of the RUC, who has been investigating the collapse of IIL since 1986, was in court to see the sentence passed but declined to comment yesterday. Although IIL and Ross have been investigated by the Garda and a file sent to the Director of Public Prosecutions, no charges have been brought in the Republic where most of the company's business was carried out. Ross was taken into custody in Oklahoma in March 1998 and extradited in May 1999. He was released on bail in February when the jury in his first trail failed to return a verdict.
Ross's solicitor, Mr Jim Rice, said yesterday that "after two lengthy trials Mr Ross had been cleared of 38 of 41 charges brought against him". He said that the trial had raised questions about the activities of certain persons in the Republic. A number of the charges brought against Ross at his first trail were dropped and Lord Justice McCollum threw out 36 charges of false accounting during the course of the second trial.
