Stephen Donnelly (Wicklow, Social Democrats) | Oireachtas source

Sarah and Dominic live in Kilkenny with their two kids and they bought their home in 2007. The shop in which Sarah worked in Kilkenny closed and the couple were unable to service their mortgage fully, although they are getting back on their feet. Two years ago, the Minister's Government sold Sarah and Dominic's mortgage to a US investment firm, which is now evicting Sarah, Dominic and their two children. Last week, the journalist Mr. Niall Brady reported that the Government sold Sarah's mortgage and that of thousands of others to the US investment firm at a 58% discount. That would have brought Sarah's €350,000 mortgage to approximately €140,000, which is approximately the value of the property and a mortgage that Sarah and Dominic can afford. The firm is Oaktree Capital and Sarah and Dominic know them as Mars Capital, which is the company that Oaktree set up to buy thousands of mortgages in Ireland.

At the time of the sale, the Government refused to allow Sarah and Dominic, or any of the Irish mortgage holders, to bid on their own mortgages. Instead, it sold them to Mars Capital with a discount of 58%. Mars Capital structured the deal in such a way that the real discount it got was closer to 70%, which would have brought Sarah's mortgage down from €350,000 to approximately €100,000. She cannot service the €350,000 so she is being evicted, which is bad news for her, Dominic and the kids but very good news for Oaktree Capital. Its accounts indicate that for its €80 million investment, it will get a return of €400 million.

It gets worse. An examination of Mars Capital's accounts is a masterclass in tax avoidance. The accounts indicate that the interest income minus the interest costs for the year come to €4,559,904. Astoundingly, the figure for administrative expenses against that is €4,558,904, leaving exactly €1,000 in taxable profit. The company has three shares issued to three different charitable trusts. The finances are also structured to ensure all interest payments and mortgage payments from Sarah and Dominic and everybody else, as well as all capital gains, can be offset against costs, ensuring there are no taxes owed.

Why did the Government sell an asset that required just €80 million to buy and that one of the leading hedge funds in the world believes is worth approximately €400 million? What does the Minister and his Government say to Sarah, Dominic, their children and the many others being evicted by these foreign firms or struggling to pay their taxes? Does the Minister accept the State will receive almost no benefit in taxes, either on profits or capital gains from these companies? Will the Government launch an investigation into the tax affairs of all these funds that purchase these mortgages in Ireland to ensure not just tax compliance - as tax avoidance is legal - but that the real profits and capital gains that these funds make will be declared properly in Ireland and taxed accordingly?

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