MORE than four people have been declared bankrupt every day in Northern Ireland since April as the economy continues to slump and the fall-out from the property crash claims more victims, figures from Enterprise Minister Arlene Foster revealed yesterday.
The statistics emerged as tycoon Sean Quinn was formally declared bankrupt in the Irish Republic after his insolvency bid in Northern Ireland was overturned on appeal by the courts.
Details of the level of bankruptcies here were given in response to a question to the Minister from SDLP Foyle MLA Colum Eastwood and show that during the first nine months of the current financial year, from April to January 10, there have been 1,164 bankruptcies. That compares to 906 in 2007/8.
Some involve large property developers owing more than £100 million because of failed schemes.
Others are business people who invested in property and have been overwhelmed by their debt, while more have suffered as their business is hit by the recession.
“The biggest reason is the relief of stress, never mind relief of debt,” said John Gordon, senior partner at legal firm Napier and Sons.
“It does not matter if they owe £10,000 or £10 million, if they are not sleeping at night, they are shouting at their children, they are gambling bankruptcy may be the way forward.”
Mr Gordon added he regularly met people who saw bankruptcy as an option.
“They are here at their wits end, credit card debts, their house is under water,” he said adding that his firm alone was representing three to four bankruptcy cases a week.
“We have had a lot of property developers, two from the Republic with debts of over £100 million each,” he added.
He said people were buying a new house then were unable to get a mortgage because the prices fell and there was no equity in their existing houses.
In such circumstances, Mr Gordon said there were benefits to going bankrupt.
“He will get a fresh start, he will not move out of his house because there is no equity in that,” he explained.
The former billionaire tycoon Sean Quinn faced proceedings from the Irish Bank Resolution Corporation - rebranded from the rogue lender Anglo Irish Bank - after wracking up debts of EURO2.8 billion (£2.3bn) in secret share deals.
In a packed court number six in Dublin’s Four Courts, Gavin Simons, solicitor for Mr Quinn, said his client did not object to the application.
The 63-year-old did not attend the short hearing.
It is expected the High Court will examine Mr Quinn’s assets and he will be obliged to hand over documentation to establish how much he is worth.
Mr Quinn had declared himself bankrupt in Belfast last month only for that to be overturned after the IBRC appealed the decision.
The former insurance, cement, glass and property magnate now faces a court order barring him from running a company for the next 12 years rather than two years if imposed by a UK court.
Mr Quinn, once Ireland’s richest man, lost control of his empire last year. The bank appointed a receiver over a £2 billion debt.