Some previously well-off Irish citizens have turned to England to be declared bankrupt in an attempt to escape the country’s stringent bankruptcy laws, which leaves bankrupted individuals under financial constraints for 12 years.
The latest well-known victim is one of the members of boy band Westlife, Shane Filan. The Guardian reports that the Westlife band member and his brother owed millions of euros to Ulster Bank and Bank of Ireland, after their joint property business proved unsuccessful.
Filan released a statement saying that having a court declaring him bankrupt was his last resort. “Together with a team of financial and legal experts I have spent months exploring all possible alternatives to bankruptcy but to no avail.
“I have worked long and hard to try to reduce my debts, and I am devastated that it came to this conclusion. I now intend to focus on the remaining dates of the Westlife tour and my commitments to the band before looking to rebuild a future for my wife, my three children and myself.”
Filan will now be under a one-year financial constraint, after which his status as bankrupt will be discharged. By staying in England he can still save a small part of his income, which he would not have been able to do in Ireland.
Filan is not the first person to turn to the English court system to avoid Ireland’s tough bankruptcy laws. However, this should become less common in the future as a result of the IMF bailout to Ireland, which has specifically required the country to reformulate its bankruptcy laws to be more lenient.