STEPHEN ROCHE IS GUILTY OF FRAUD
Spanish court delivers ruling on cycling legend
CYCLING hero Stephen Roche has been ordered to repay €750,000 after a Spanish court found he negligently bankrupted his Marbella firm and plundered its assets to finance a luxury lifestyle, the Irish Mail on Sunday can reveal.
The damning civil court ruling found Mr Roche deliberately and consciously stripped the assets from his cycling holiday firm rather than repay creditors before disappearing from Marbella in 2017. He has now been banned from acting as a company director in
Spain for seven years and could be exposed to criminal prosecution.
Last night, Mr Roche, who tragically lost his father Larry this week, vowed to make a comeback and said he will be appealing the ruling.
‘I will bounce back, definitely,’ he told the MoS. ‘I promised my dad I would.’
‘The big thing is we are appealing,’ he said of the ruling against him. ‘It’s not definitive.’
One of Ireland’s most treasured sporting heroes, Mr Roche famously won cycling’s Triple Crown in 1987, with epic victories in the Tour de France, the Giro d’Italia, and the Road World Championships.
Using his fame and popularity, Mr Roche built a successful cycling tourism business in Marbella after retirement.
But, as first revealed in the MoS, that company – Shamrock Events SL – went bust in 2017 leaving creditors out of pocket.
In an interview with this newspaper in Budapest in 2019 – when creditors forced Roche’s firm into bankruptcy – Mr Roche denied he was fleeing his responsibilities in Marbella and pledged to repay his liabilities.
But a final 41-page ruling on the matter from Palma’s Commercial Court Number Three concluded Mr Roche did not heed staff warnings that his firm was in trouble and worsened the situation by using company funds to finance a luxury lifestyle.
The April 13 ruling by Judge Margarita Isabel Poveda Bernal followed hearings in February at which creditors, former staff and the insolvency practitioner appointed to Mr Roche’s firm testified.
According to the Spanish judge, Mr Roche’s conduct in ‘generating and aggravating’ the insolvency of his firm was ‘malicious or gravely negligent’.
‘Mr Roche was perfectly conscious of its debt situation,’ the judge said. ‘And instead of adopting measures to avoid financing the company, or entering into voluntary insolvency, he continued to loot the company accounts for his own private use when there was a minimum amount of income in them.’
The Palma-based judge also used her ruling to address the personal lifestyle Mr Roche funded with company money.
‘Mr Roche’s sumptuous expenditure on things like golf, apartment rentals, hotels in Switzerland and Hungary, restaurants, clothes stores and fashion houses like LOEWE, evidence a life of luxury and spending while his creditors… weren’t paid.’
The judge said these creditors included hotels that had provided accommodation
and meals to clients of Mr Roche’s who had paid his firm for cycling holidays.
The south Dublin native how has two weeks left to appeal the court’s decision, and has pledged to do so.
At the time of his firm’s bankruptcy in 2019, Mr Roche claimed he had been very open with people he owed money to and denied acting fraudulently.
‘I cannot for the life of me imagine how they could say such stupidity,’ he said at the time.
However, this month’s court ruling paints a different picture.
It states: ‘It has been proven Mr Roche disappeared from Mallorca in 2017 after some 25 years of business activity and that his disappearance coincided in time with the appropriation of his company’s income and the simultaneous failure to pay the Spanish taxman as well as creditors who had already provided accommodation and meals.’
Most of the €733,866 Mr Roche has been ordered to repay is based on the amount the court says he ‘fraudulently and intentionally removed’ from his company.
The remainder – €18,051 – is the estimated value of a Volkswagen Transporter Caravelle company car that is still unaccounted for since the collapse of the company.
The main creditors of Roche’s firm are two Marbella hotels – the Aparthotel Ponent Mar and the Hotel Son Caliu – where he housed cycling clients.
Based on the evidence presented to and heard by the court
‘Malicious or gravely negligent ’
during previous hearings, the judge ruled the bankruptcy of Shamrock Events SL was ‘culpable rather than fortuitous’.
The judge pointed to ‘substantial breaches of accountability’ on the part of Mr Roche given his failure to cooperate with his firm’s insolvency practitioner and to abide by Spain’s voluntary insolvency laws.
The ruling includes details of testimony given by a witness who worked for and did the accountancy for Mr Roche’s firm.
This witness told the court ‘that in 2016 things began to go wrong, that money was missing, that Mr Roche would take money from the company accounts and then return it’.
According to the judge’s ruling, the bookkeeper ‘stated categorically that Mr Roche took money from the accounts, transferred cash to outside private accounts which were
‘Used company cards for gifts, hotels and clothes’
not linked to the firm he was administrating, used company cards for private spending, to buy gifts, pay for hotels in Hungary and Switzerland, purchase clothes and luxury LOEWE and Hugo Boss items’.
The ruling said the bookkeeper further ‘stated that he reproached Mr Roche’s behaviour on several occasions, telling him he couldn’t do this’.
The bookkeeper also told the court ‘the company’s financial adviser had warned Mr Roche about the accounting irregularities and told him he had to sort things out and put the money back or the company would go bust’.
The ruling also notes the same witness told the court during his evidence that Roche earned €3,900 a month as the company’s ‘director’.
In her ruling, the judge also criticised arguments from Mr Roche that Brexit, his lack of business knowledge and his lack of access to financial records had impacted on his ability to deal with matters in Marbella.
‘Shamrock went into administration on April 26, 2019. The UK ceased to be an EU member state on January 31, 2020,’ the judge commented in her ruling.
She also dismissed Roche’s claims that accounting records his company had failed to hand over to the insolvency practitioner were in the hotel where he had registered his firm and that he had been prevented from getting to them.
‘The excuse the accounting records that were constantly requested but never handed over, were in the offices of the insolvent company inside the Aparthotel Ponent Mar is quite a poor one,’ she wrote.
‘As if accounting records, instead of being digitalised and able to be sent from any computer terminal in the world, were in obsolete and dusty accounting books or on computers that were not connected to the internet and had been abandoned in a physical place.’
Unless he can overturn the ruling on appeal, the seven-year ban imposed on Mr Roche disqualifies him from ‘administering third-party assets, as well as representing or administering anyone’.
He has also been ordered to pay all costs and personally repay any debt left over following the completion of the insolvency process.
José Luis Lopez Morey, the lawyer acting for Ponent Mar SA, which was one of the companies that took Mr Roche to court, said the ruling was ‘very comprehensive’.
‘The judge has supported our assertion which was that the actions of Mr Roche were completely negligent and contrary to the behaviour of a law-abiding and dependable administrator,’ he said.
‘He’s taken advantage of his company for his own private benefit, to the detriment of many people including his creditors and his own employees.
‘He’s left a mess behind him in Mallorca and he hasn’t returned.
‘He can appeal but the fact the ruling is so hard-hitting and Mr Roche has been censured not just over a single action but for many of his actions means that, in my view, any appeal has little chance of prospering.’
‘Left a mess in Mallorca and hasn’t returned’