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Drumm bid to salvage £1.3m US home could be blocked

The wife of former Anglo Irish Bank chief David Drumm could be blocked from defending a secretive $2m (£1.3m) property deal, if the bankruptcy official running the Drumm case in the US gets her way.

Mr Drumm filed for bankruptcy in Boston in October 2010 after moving to the US. It came after he failed to reach a settlement with Anglo Irish Bank over loans of €8.5m (£7.3m).

His bankrupt estate is being managed by Kathleen P Dwyer, a court-appointed bankruptcy trustee. As part of her recovery of assets, the trustee wants to break up a legal "trust" that owns a $2m house in Massachusetts.

Ms Dwyer wants the house sold and any cash raised to go towards settling Mr Drumm's debts.

In September, the trustee took a case against Mr Drumm, his wife Lorraine and the trust manager, Anne Marie Greenberg, aiming to have the trust dissolved.

Ms Dwyer claims cash from the house should be used to help pay off Mr Drumm's debts, because she alleges the property was bought using money that made its way to the trust through fraudulent asset transfers from Mr Drumm in the first place.

Back in August, Ms Dwyer filed a lawsuit against Mr Drumm that could block him from exiting bankruptcy. She said Mr Drumm failed to disclose numerous property and financial transactions involving his wife when he entered the US Chapter 7 bankruptcy process.

The Drumms deny those allegations and Mrs Drumm has asked for a chance to defend the trust in court. A Boston judge will decide on the issues at a trial.

Belfast Telegraph