Guardian: Irish bankruptcy tourism on rise

From The GuardianIreland turns to bankruptcy tourism; Bankruptcy in Britain offers a way out for Irish entrepreneurs crushed by debt from heady property boom:

Niall is 31 and manager of a successful fruit farm just outside Dublin. He is thinking of emigrating to England – not because he is out of work but because he is so heavily in debt that he wants to declare himself bankrupt.

He bought three houses as a buy-to-let sideline between 2004 and 2006. Although he earned a modest salary of €25,000 a year (less than £17,000 then), the banks gave him two mortgages of more than €300,000 and another one for more than €200,000 – a loan-book worth 32 times his salary.

The fantasy of becoming a property millionaire did not last long and now the farm manager is in negative equity to the tune of €250,000 and with a glut of empty properties on the market, he has no hope of meeting monthly repayments from rent…

Declaring himself bankrupt in Ireland is not a realistic option: bankrupts must wait 12 years before they are discharged from their debts. But under European Union law he can file for bankruptcy anywhere in Europe. If he relocates to London or Manchester he can be free of his debts within 12 months, courtesy of the “progressive” UK law.

Niall’s case is far from unique. “Bankruptcy tourism” is the talk of Dublin and the conversation is being held across all strata of society.

Jim Stafford, at the corporate recovery practice Friel Stafford, said: “Personal bankruptcy was virtually unheard of 10 years ago, now it’s everywhere: politicians, high-level civil servants, buy-to-let investors, doctors and lawyers.”

Read more.

This entry was posted in Civil Disobedience, Civil Rights & Liberties, Debt Default/Restructuring, Economy, EU, Housing Bubble, ireland, Solutions and tagged , . Bookmark the permalink.

One Response to Guardian: Irish bankruptcy tourism on rise

  1. Pingback: Forgive Us Our Debts… from Ancient Greece to CNBC (& Morgan Kelly, David McWilliams) |

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