Duty debt not his, says Ryan

| 13/04/2012

30124_4320_l (222x300).jpg(CNS): The developer of the Ritz Carlton-Grand Cayman, who is currently facing a number of legal battles, says that the outstanding $6 milllion owed to government is in the handsof the receivers. When asked about the debt, Michael Ryan told CNS on Thursday that he was not authorized to make any statements about the companies now in receivership. He said, however, that he no longer had responsibility as the duty was owed by those companies set up to develop the resort and not him. Ryan said he had attempted to make progress on a payment plan but he did not know now whether the receivers would honour debts due to the creditors of the companies in question.

The companies associated with the development of the Ritz Carlton, now controlled by receivers on behalf of Ryan’s major creditor RC Cayman Holdings Ltd, are suing him over misappropriation of undisclosed funds. However, Ryan said it was the companies in receivership, “not me personally”, that owes government money.

“My plan at the time was to negotiate a payment plan and an on-going development agreement with government so that funds could be raised to pay the amount owing," he said in an email. “You have seen from the correspondence that Mr Jefferson was unable to make progress on this for over a year prior to the receivership. I do not know whether the receivers will honour the debts due to creditors.”

The financial secretary had pursued the debt, which the Treasury believed should not be tied to the future proposed development of Dragon Bay. But according to correspondence released under an FOI request, Ryan had persisted in attempting to tie in his desire to buy crown land at Safehaven and the Dragon Bay project with the significant duty debt.

Ryan said Thursday that the Dragon Bay project is legally distinct from the receivership of the property-owning companies, but the litigation would have a negative effect on its future as well.

“Which may be what the lender wishes to achieve,” he added. “I believe Dragon Bay is a tremendous project that I hope will get the support it needs to go forward. The Ritz developer also said he would not be leaving the islands and intended to fight the legal battle he now found himself in. “Cayman is my home. I've lived and breathed this development for more than 15 years and I'm proud of what we have been able to create."

Ryan or the companies he once owned that developed the Ritz-Carlton owes the Cayman Islands Government over $6 milllion in outstanding duty in relation to concessions he was given during the development phase of the hotel. Despite persistent efforts by the financial secretary’s office to get Ryan to re-instate his quarterly payments to address the debt, which was originally over $10 million, the developer has not made any payment to the Treasury since March 2009.

Government officials confirmed that they have approached the KPMG auditors, Kris Beighton and Keith Blake, appointed as joint receivers by RC Cayman for the companies associated with the resort about government’s claim but they were not confident that the public purse would be able to recover the significant debt.

The extent of Ryan’s legal and financial troubles was revealed in February with the news that RC Cayman Holdings LLC, which acquired the loan in May 2011, originally taken out with RSB to develop the hotel, had filed a legal action to take control of the Ritz.

Category: Local News

Comments (35)

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  1. Knot S Smart says:

    I looked at the photo and wondered 'Where is Mac's left arm and Ryan's right arm?

    Then I remembered. 'You scratch my back and I will scratch yours'

  2. SKEPTICAL says:

    Wonderful things Limited Liability Companies, behind which to hide, when the shit hits the fan and there are creditors to be paid – unless, as a Director, it can be shown that you have failed in your Fiduciary Duties or, it can be proved that you actually had your hand in the. “cookie jar ” .
    Ryan must have thought that all his Christmases had come together when our financial wizard Bush agreed to a moratorium on payment of the deferred Import Duty liability. KYD$ 347,000 a quarter of Cash Flow which did not have to be paid to Government, which could be put to other uses and for which, the shit HAVING now finally hit the fan, as he rightly says, he is not personally responsible – what a marvellous ” Get out of Jail Free ” card.

    • Anonymous says:

      Don’t knock limited liability companies. Without them, a vast amount of commerce that takes place now simply wouldn’t do so because of the risk involved, and Cayman’s financial industry wouldn’t exist.

      • SKEPTICAL says:

        How anal can you be, and clearly totally unfamiliar with the word – IRONY

        • Anonymous says:

          Actually the poster seemed to understand thta you had used the word "wonderful" ironically. 

        • Anonymous says:

          Um, I guess I’m anal enough to recognise someone who doesn’t understand the meaning of the word “irony”. It’s not the same thing as your leaden sarcasm, Einstein.

  3. Anonymous says:

    A promise is a comfort to a fool….the higher the monkey climbs,the more his back**de is exposed…what goes up. must down….when will McKeeva Bush EVER learn ?!

    Cayman needs to learn to stand on its own feet and quit kissing a rich man's ar*e for peanuts…build Cayman, with Caymanians for Caymanians…

    This is just the writing on the wall.

    Look out for Darts disaster next, when things go belly-up and he owns Cayman.

    Wisen up Caymanians, before its too late !

  4. Anonymous says:

    Why not a picture with Michael Ryan and Chuckie or Alden?..We are getting tired of seeing Mckeeva…Is he the Poster child for CNS?

    • Anonymous says:

      Err… that would be because he did the deal with McKeeva and they are/were good buddies.

      XXXX

      McKeeva is poster child of all that is wrong with Cayman.

  5. Anonymous says:

    Debt?? – no, thats not mine…

    the Jet, Yachts, Mansion,  – oh, now those ARE mine!

    'nuff said.

  6. Anonymous says:

    CNS, we is soooo bored wit de big shots gittin all de money.  I tink you cuold get many more responzes if you cuold use dat picture and make sum sort of waterballoon game of it.

  7. Anonymous says:

    It wazne me!

  8. Anonymous says:

    So the profits are yours but not the debt………

  9. Anonymous says:

    Laurel and Hardy

  10. Anonymous says:

    Mr. Ryan is probably right about this. It probably isn’t his responsibility any more.

    My view is that CIG has a better chance of recovery now that he has been removed although it is probably quite a long way down the totem pole of creditors.

    One has to admire Mr. Ryan’ s chutzpah, if not his ethics. He did manage to build a fantastic resort on nothing but a good sales pitch, even in the face of numerous accusations that he was a fraud.

    It’s rather amusing that a religious group were taken in by him, when so often it is usually such groups that take from those that don’t know how to protect themselves from BS.

  11. Anonymous says:

    Folks, get your facts straight.  The Ritz-Carlton operators work off of gross revunues.  That is were the money is.  The owners work off of the profit from the operators, which there is none.  The operators can not service the debt let alone the duties.  It is RC's fudicial responsibility to make good on the lenders, which they have failed at miserably, not MR.  Mark my words, DART will scoop up this property at $0.50 on the dollar, unbrand it and call it CamanaBeach.

  12. Anonymous says:

    Blame falls solely and squarely on the Gowerment for letting Ryan have credit terms in the first place.  Mr. Premier, surely the Gowerrment has a contract with some entity or the other to guaranteerepayment of the duty owed?  Surely?  No?  Of course not, this would have been good business practice and proper due dilligence, of which you have absolutely no comprehension.  "Substance over Process," right?  Well, there goes six million dollars worth of substance you've squandered on behalf of the honest taxpayers of Cayman.  Add this $6M to the millions squandered on the Cohen and GLF fiascos, and the outrageous sum you gave to the churches and see why you can't balance the budget.  Sir, considering the amount of our money you've thrown to the wind, you should hang your head in shame. 

  13. Anonymous says:

    Imagine Cayman without the Ritz. Quite a few people wouldn't be where they are now if the Ritz hadn't existed. Business has been exceedingly  tough, and it's easy for those who have never taken on the responsibility of meeting paychecks on a weekly basis to slag-off those who have been caught between a hurricane and a recession. I've no axe to grind, just credit where credit is due.  Cheap shots are just that:cheap.

  14. Anonymous says:

    Know what is really sad…..he is technically right. The debt belongs to the Ritz Carlton or the 
    "developer" of the Ritz Carlton which is a limited parent company of a limited company of a limited company…..all of which have been taken away from Mr. Ryan so now he washes his hand of it and walks away scot free. 

  15. Anonymous says:

    You mean the UDP govt. did not even get a personal guarantee from Mr. Ryan?

  16. Anonymous says:

    “My plan at the time was to negotiate a payment plan and an on-going development agreement with government so that funds could be raised to pay the amount owing

    ———————————————————————————————————————

    Sounds like a pyramid scheme to me….

  17. Anonymous says:

    sweet

  18. Anonymous says:

    Investors in Cayman, beware.

    • Joseph Dwyer says:

      Ryan is only personally liable if he gave personal guarantees. Understand that people . His trading was done under companies structures Therefore the companies are liable for the debt. If the liquidators find that he was negligent in his fiduciary duties as Director appointed by shareholders then that is a horse Of a different color . Finally, I’d he is a sole owner then he is fully liable.

      • Anonymous says:

        70% correct. Negligence and breach of fiduciary duties are two separate concepts. The former is a breach of your duty of care (which no doubt will be covered by an indemnity by the Company), and the latter is a breach of duties of honesty and good faith which may not be covered by an indemnity. Being the sole shareholder of a company does not automatically make you fully liable for the debts of the company unless the corporate veil can be pierced for example where the company is used as an instrument of fraud.  

  19. Anonymous says:

    Reminds me of that Shaggy song, "Wasn't me".

  20. Anonymous says:

    I wonder if the Premier is going to blame this one on the PPM as well.

    As I recall Mr. Ryan was paying his debt to the Cayman Islands Government on a monthly basis and then after the UDP took office, suddenly the payments stopped.

    Did the Premier insist during the last 3 years that Mr.  Ryan resume payments as previously agreed or at least attempt to have some kind of security from Mr. Ryan for the debt? Absolutely not!

    So now this is what we end up with! Mr. Ryan claims that “Cayman is his home” but am sure he said the same about Costa Rica as well. It is his home until the current Premier is no longer there to protect him and then I can assure you we will never see or hear from Mr. Ryan again.

  21. Selling Shells by the seashore says:

    What company??  Ohh.. that company!  No, I don't own that company. That company is a trust of another company. Which is a subsidary of another company registered in my chihuahua's name.

    This whole thing started with a company called FUJIGMO.  Get it?

    For a jurisdiction famous for facillitating the setting up of shells… no one saw this coming?

    FUJIGMO:  Forget You Jack..I Got My Oders

    CIG you've been had.

  22. The Magic Dragon says:

    Just as I said, "its all some crazy mix-up".He didn't do anything wrong,the company he ran did it!  What is  this world coming to; accusing a decent human being like Mr. Ryan of such scum-bag behaviour. You all should be a shame of yourselves.

    Dats right Mr. Ryan, I gah yah back bobo. No caymanian left behind!

     

  23. Anonymous says:

    ROTFLMAO!!!!!

    If I was Mr Ryan I would double-check that because these kind of debts tend to stick to you like used chewing gum and are just as hard to shake off.

    The difference between unpaid duty or tax and defaulting on a loan is that the former is normally a criminal offence not a civil recovery issue. That is of course unless the original deal had a 'get out of jail free' clause conveniently built into it. 

  24. Whodatis says:

    "Not my responsibility … "

    Jotting that one down on my next custom duty form!