Sheriffs Roam Ireland Seizing Cars From Debtors After Collapse
Pedestrians walk past a branch of Allied Irish Banks Plc. (AIB) in Dublin. Photographer: Crispin Rodwell/Bloomberg
Sheriffs in Ireland, who collect debts rather than police small towns, are chasing luxury cars, motorbikes and art as creditors try to recoup money they lent before the economy collapsed.
“We’re getting orders worth millions,” said John Fitzpatrick, a sheriff in Dublin who has confiscated Jaguars, Range Rovers and Mercedes from indebted businessmen. “Those people are owned body and soul by the banks.”
Statistics show Ireland is beginning to recover from its worst recession in 89 years as an independent country. At the same time, court documents suggest the mountain of debt accumulated in what was the euro region’s most dynamic economy five years ago will take longer to overcome.
Fitzpatrick, 66, is one of 16 sheriffs appointed by the Justice Ministry to pursue unpaid taxes. In the High Court in Dublin, debt recovery claims rose 48 percent to 5,653 cases in 2009, according to the Courts Service.
Ricky Wilson at Wilsons Auctions in the west of the Irish capital said the amount of assets he has sold for sheriffs has increased by as much as 15 percent this year. Wilson, who will invite bids for a confiscated Ducati motorbike on July 31, expects business to remain brisk for the rest of the year.
Raising Money
Sheriffs execute court judgments against borrowers who don’t pay debts. They are self-employed and get some expenses paid by the state. Once property is seized, they are responsible for selling it to help pay creditors.
“When money was really tight, they literally used to take blankets off beds,” said Jim Stafford, whose corporate recovery agency in Dublin advises companies on how to deal with sheriffs. “They don’t do that anymore. They’re looking for high value.”
At his showroom this month, Wilson said the Ducati 996 motorbike was originally worth as much as 20,000 euros ($26,000) and was seized by a sheriff working for the tax agency.
“It’s the equivalent to a Ferrari car,” said Wilson, 32, whose grandfather founded the family-owned business in 1936. “It tells a tale.”
Last month, a sheriff seized artwork belonging to property developer Bernard McNamara at his home in Dublin’s affluent Ballsbridge district, newspapers including the Irish Times reported. McNamara said in a Jan. 13 interview with national broadcaster RTE that company debts of more than 1 billion euros had left him broke.
A spokesman for McNamara, 60, declined to comment on the reports. Brendan Walsh, the sheriff reported by the Irish Independent to have seized McNamara’s art, said by telephone he couldn’t comment on individual cases.
‘Poundage’
The Irish system predates the 12th century, according to Stafford. The sheriffs earn commission known as “poundage” on the goods they take, taking 5 percent on the first 5,500 euros, or 275 euros. They are entitled to 2.5 percent on any additional balance, according to tax authorities.
Sheriffs acting for the tax office chased debts of 697.4 million euros last year, up 31 percent from 2006.
“They love motor vehicles because they can be driven away,” said Stafford, who published a leaflet entitled Keeping the Sheriff at Bay. “They don’t like dealing with cattle.”
Ireland sank into the mire as property prices plunged as much as 50 percent from their 2007 peak and the country’s biggest banks needed rescuing from bad debt. The government spent 7 billion euros bailing out Bank of Ireland Plc and Allied Irish Banks Plc and nationalized Anglo Irish Bank Corp.
Irish households are among the world’s most indebted after lending more than tripled in the decade through 2007, according to Goodbody Stockbrokers in Dublin.
“One home I visited was palatial, an absolute palace,” said Fitzpatrick, who has been a sheriff since 1979 and employs about 20 people. “The guy was reduced to bankruptcy. He was emotional. I don’t think he had anything left.”
To contact the reporter on this story: Louisa Fahy at lnesbitt@bloomberg.net
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