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E-mailOpposition by developers to the National Asset Management Agency has largely collapsed after the asset management agency commenced foreclosure action against 22 borrowers.
The majority of the borrowers have returned to the negotiation table and legal proceedings have not now moved to the court stage, a Nama source told the Sunday Tribune.
The developers who had been holding out against the agency became compliant once they realised that Nama was willing to go to court and bankrupt them or seize their assets, the source said.
There has been much speculation about the fate of assets transferred by developers abroad or to their wives or trusts for their children. Fears have been raised about the legal limitations of Nama but legal sources have insisted that the transfers will be overturned by the courts because it is illegal to use transfers to avoid financial obligations. In the only similar case to come before the courts, former Anglo chief executive David Drumm's transfer of his family home into the name of his wife was overturned by Mr Justice Peter Kelly who made an order setting aside ab inito, meaning it was as if it had never happened.
Nama has told the developers that if they don't consensually transfer the assets back within a specified time period, it will still pursue them in court.
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Borrowers who try to defraud NAMA should be jailed. NAMA is in a similar position to the Revenue in that it is collecting money on behalf of Irish taxpayers. It will need similar penal enforcement powers as the Revenue, and experienced Revenue investigators, to speed up collection and ensure bad debts are minimised. Otherwise many property developer borrowers will hide as much wealth as the penalty for doing so would seem minimal in the circumstances. But if they could be forensically investigated by experienced Revenue officials and jailed for their efforts then maybe this mess would be sorted out more quickly.