Almost €29m in assets misappropriated from clients of collapsed investment firm Custom House Capital will be returned to them soon, according to lawyers for the official liquidator. The distribution will bring to €41m the amount in recovered misappropriated funds given back to clients since the firm went bust in 2011 with total investor losses of €61m. The High Court heard on Wednesday sums recouped by liquidator and administrator Kieran Wallace were significantly better than previously forecast.

Barrister Paul Brady, for Mr Wallace, said: “€16m more was generated from the realisation of assets than had been estimated and predicted back in July 2020. This means that there is now €28.9m to be distributed.”

He said Mr Wallace was engaging with Davy to issue letters to 1,292 clients regarding how funds can be transferred to them. The disclosure will be a source of relief for many investors burnt following the firm’s collapse. Claims for compensation need to be certified by the liquidator. But the process was delayed for a significant period while the State’s investor compensation scheme, Investor Compensation Company DAC, sought clarification about an aspect of its statutory powers. Despite the upbeat progress report, the court heard some investors were unhappy.

Roger Day, an investor who previously appeared in court as a “legitimus contradictor” representing the interests of 1,300 clients, said he would be applying to be reappointed to the role. He told Mr Justice Brian O’Moore “huge concerns” existed after some claims were rejected and alleged Mr Wallace had failed to take notice of decisions made by another judge, Mr Justice Mark Heslin. His application, due to be heard next March, could be opposed by Mr Wallace. Mr Brady described the application as “misplaced”.

The barrister said while it was now estimated the majority of misappropriated funds would be recovered by the end of next year, such was the “systemic misuse of funds” it could be “quite a long time” before a certain cohort could be recovered. These include misappropriated funds which had been mixed in with legitimate client investments.

“In many of these cases it is just not possible to realise the funds properly,” he said.

“It is not appropriate to do so. It wouldn’t be in the interest of other investors and it wouldn’t maximise the return of misappropriated funds. Allowing those assets to work themselves out will take time.”

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