Liquidators appointed to Athlone firm as Central Bank voices concern over 'irregular transactions'

At the High Court yesterday (Thursday), liquidators were appointed to the Athlone-based investment firm Strand Investments & Finance Ltd, trading as 123 Financial Services.

The appointment of provisional liquidators came as the Central Bank expressed concern over "a number of apparently irregular transactions or activities" at the company. The firm has approximately 700 clients, all of whom are based in Ireland.

In a statement published on its website, the Central Bank announced that following an application which it made to the High Court on Thursday, Aiden Murphy and Declan Hanly of Crowe Ireland had been appointed as joint provisional liquidators to Strand Investments & Finance Ltd.

The company has its registered office at, and was operating from, 15 Castlemaine Street in Athlone.

The Central Bank said it became aware last September of the death of one of the firm's directors, Bernard Kinahan, of Barrybeg, Athlone.

It also said it was aware of "a number of unusual aspects of the case" that were "of concern".

The Central Bank's statement said these issues included "an absence of ongoing governance or management of the daily activities of the firm since the passing of Bernard Kinahan", and "a number of apparently irregular transactions or activities undertaken in relation to some customer accounts that require further assessment and review".

The company appeared to have "effectively ceased trading" since September last, but, on December 10, the Central Bank formally directed it to "suspend the provision of all regulated financial services" in order to protect its clients.

"We took custody of the books and records of the firm and froze its accounts," it said.

The provisional liquidators have now been appointed "to wind-up Strand" in order to "ensure the protection of clients' interests".

The role of the provisional liquidators "is to manage the affairs of the company, secure its assets and deal with queries from investors and all creditors of the firm", and a High Court hearing to consider appointing an 'official liquidator' has been scheduled for February 9.

The Central Bank said the provisional liquidators would "immediately" begin their work "to establish the current position of all client investments" made through Strand Investments & Finance Ltd.

"The provisional liquidator is aware of the urgency of completing this exercise as soon as possible," it stated.

Following the High Court hearing on February 9, "the provisional liquidator would expect to become the official liquidator (and) will then continue their work to establish the position of all client investments."

The Central Bank added that, as an authorised "investment business firm/investment intermediary" Strand was "licensed to provide investment advice, products or services".

It was "not permitted to accept cash from a client for investment purposes" and therefore all payments were "required to be made directly to the product provider (e.g. investment firm, insurance company etc).

"Strand is not authorised to hold client assets," it stated.

In a message to Strand clients seeking to check the value or status of their investment, the Central Bank said: "The joint provisional liquidators will contact all Strand clients as soon as possible in relation to their investments to advise them of the liquidation process, the timelines involved, and to address any questions.

"The joint provisional liquidators will make a full assessment of the current position of the firm and advise clients of the outcome.

"Clients of Strand should also contact the product provider with which their investment is held. If, following this engagement with the product provider, a client has any questions in relation to their investment they should contact the joint provisional liquidators."

To clients of Strand who are concerned about the possibility of losing money as a result of their involvement with the company, the Central Bank said it was "aware of certain irregularities that have occurred and these will be a focus of the investigation for the joint provisional liquidators.

"In many cases our expectation is that clients' investments with their product provider will be intact and secure," it added.