Former Anglo Irish CEO Drumm humbled in bankruptcy

* Now a finance consultant, Drumm faces own restructuring

* Driving a used Ford in place of Land Rover

By Ross Kerber

BOSTON, Dec 7 (BestGrowthStock) – Until recently, David Drumm was
the chief executive of Anglo Irish Bank [ANGIB.UL], drove a
35,000 euro Land Rover and flipped vacation homes on Cape Cod.

Today he is bankrupt, drives a $1,000 used Ford Taurus and
hopes a Massachusetts court will let him keep supporting family
members. If a judge cuts off some payments, Drumm told a court
trustee on Tuesday, one consequence would be “a very upset

A metaphor for Ireland’s financial humiliation would be
harder to find than the hearing held Tuesday morning in the
airy boardroom of a downtown Boston law firm.

On the same day that Dublin’s government was unveiling a
deeply unpopular austerity budget in the wake of the country’s
banking crisis, Drumm was forced to testify under oath for the
first time about his holdings as part of a complex bankruptcy
process that puts at risk his remaining properties, vehicles
and even his ability to buy gifts for his children.

In a court document, Drumm has listed total assets and
liabilities of $1 million to $10 million.

Now living in Massachusetts, where he once ran the Irish
bank’s commercial lending operations, Drumm filed for Chapter 7
bankruptcy in October as part of a bitter dispute with his
former employer, which was nationalized in early 2009.
[ID:nN15210107] Raised north of Dublin, Drumm was named
Anglo-Irish’s CEO in 2004 when he was just 37.

But now the bank is suing Drumm in Ireland for the
repayment of loans to him. Drumm claims he is being made a
scapegoat, and has faced talk of his being extradited back to
Ireland as part of an ongoing investigation.

Separately, attorneys representing Drumm’s estate have
charged that the bank fraudulently had Drumm take on an
unsecured $10.7 million liability in order to improve the
appearance of the bank’s books in early 2009.


It could be months — and tens of thousands of dollars in
attorneys fees — before the claims are hashed out. Drumm had
already filed details of some of his assets with the court,
such as the late model Mercedes sedan and SUV he surrendered in
October, and loans on properties like the house where spends
much of his time in the resort community of Chatham.

But the disclosures to date did not spare Drumm the
spectacle he faced on 21 floors above Boston Common on Tuesday,
where a trustee had his attention for two hours. The hearing
was open to the media.

Clad in a dark suit and blue tie, his receding hair clipped
close, Drumm was unfailingly polite as he sat with his lawyers
at a conference table disclosing the basic and mundane details
of his financial life — a role reversal for any banker more
accustomed to pressing borrowers for the same information.

Yes, Drumm told the court, he has been charging his sister
rent for a property he leases her. No, he has not bought his
children any expensive gifts lately worth more than $500 — oh,
except for some computers. It is correct that his wife has
petitioned the bankruptcy estate for about $210,000, money
Drumm said represents her investment in the consulting business
from which he now makes his living.


Also, the mortgage for another home in an upscale Boston
suburb was arranged through a trust. “The purpose of the trust
was privacy, in terms of the attention I received,” Drumm

Drumm made no nod to irony as he described the work of his
consulting business, Delta Corporate Finance, which he said
focuses on debt restructuring and disposals. He draws a salary
of $9,000 a month from the business, he said.

Drumm and his attorneys left the hearing without commenting
to reporters. An attorney for Anglo-Irish bank said he would
not comment. Further hearings are scheduled, and the bank will
get its own chance to press Drumm for more details next month.

For Kathleen Dwyer, the sharp-eyed bankruptcy trustee who
conducted most of the day’s questioning, the session was just
another day in a career she estimated has included nearly
20,000 cases. But Dwyer could not recall the last case that
involved such a high-profile debtor. “It’s a changing world,”
she said.

(Reporting by Ross Kerber; Editing by Aaron Pressman and
Richard Chang)

Former Anglo Irish CEO Drumm humbled in bankruptcy