Court approves payments to clients of bankrupt stockbroking firm
The High Court has today approved an additional and final payment to the clients of a stockbrokers firm which collapsed with losses of millions of euro more than 10 years ago.
W & R Morrogh, a Cork-based stockbrokers ceased trading in April 2001 after it was discovered the firms junior partner Stephen Pearson embezzled €5.5m of clients' funds to play the stock market.
Pearson from North Esk, Glanmire, Cork was given a five-year prison sentence after he pleaded guilty to 31 charges of fraudulently converting clients' funds, 11 charges of forgery and five counts of obtaining funds under false pretences between November 1995 and April 2001.
The collapse resulted in the firm's closure by the Central Bank, with losses to more than 2,500 clients of approximately €13m. The company had been in operation since the 1890s.
Today at the High Court, Mr Justice Paul Gilligan granted a number of orders including that creditors of the firm are to receive a second and final dividend of 13 cent for every euro claimed.
That payment brings the total dividend paid to creditors, arising out of the firm's receivership, to 43 cents in the euro.
The court also heard the Investor Compensation Company Limited (ICCL), which provides compensation for eligible investors of failed investments, had provided €7.7m to Morrogh's clients. This, the court heard, meant that creditors got back 60c in the euro.
The orders were sought by the receiver, Mr Tom Grace of Pricewaterhousecoopers, who was appointed receiver to the firm in 2001.
The court also set the end of October as the former date when the company will be dissolved and the receivership will be at an end.