Former Anglo Irish Bank chief David Drumm faces the loss of his Boston home, his Cape Cod holiday home and his former Dublin home as the bankruptcy official in charge of his financial affairs has claimed that he fraudulently transferred the properties to his wife.
The court-appointed trustee, lawyer Kathleen Dwyer, said that Mr Drumm moved assets beyond the reach of his creditors by engaging in a series of transfers to his wife, Lorraine Drumm.
Ms Dwyer said in a new complaint filed in court that she intends to sell Mr Drumm's home in the Boston suburb of Wellesley, the property at Stage Neck Road in Cape Cod purchased with $4.2 million in cash and his former home in the Abington estate in Malahide.
She claimed that Mr Drumm set up "a sham trust" to buy the couple's home in Wellesley and that Mrs Drumm gave her husband "a fictitious loan" of $210,000 which was sourced from his earnings.
The loan was "a sham transaction" to invest in Mr Drumm's new business in the US to qualify for a temporary visa to live in the US and that the funds were "shielded" in an account, Ms Dwyer claimed.
She said that the funds were used as "a personal piggybank" to spend on his personal finances and "to disguise and conceal the transfers made to Mrs Drumm".
Lorraine Drumm is entitled to half the proceeds from the sale of the family's home in Boston but the trustee is objecting to any money being paid to Mrs Drumm.
Ms Dwyer said that Mrs Drumm acquired her interest in the Wellesley property as part of a scheme to defraud creditors of her insolvent husband.
The trustee and Anglo Irish Bank have asked the Massachusetts bankruptcy court not to allow Mr Drumm a fresh financial start as he failed to cooperate in the proceedings and concealed assets.
Mr Drumm filed for bankruptcy in October 2010 to protect himself from Anglo's pursuit of him over loans of €8.6 million.
The judge in the bankruptcy case will determine whether Mr Drumm should disallowed a discharge from bankruptcy and whether he must respond to allegations by the trustee and Anglo that he defrauded his creditors by transferring assets to his wife.
