February 16, 2011
By Staff Reporter
The chapters are slowly but surely closing in the long-running saga of U.S. businessman John DeLorean’s ill-fated car manufacturing operation in Northern Ireland. The auto maker collapsed in 1982.
In bankruptcy court in Detroit on Friday last, a $27.2 million out-of-court settlement between accountancy firm Arthur Andersen LLP and the bankruptcy trustee for DeLorean Motor Co. was submitted for review.
Arthur Andersen does not admit guilt in any of the settlement documents. It’s believed much of the payment will be covered by insurance.
The settlement comes more than a year after a New York jury found the accountant was negligent in audits of the defunct auto company.
Arthur Andersen had been ordered by a New York State jury in March 1998 to pay $46.2 million for delivering clean audit opinions in 1978 and 1979 on the auto maker.
An earlier lawsuit filed against Arthur Andersen by the British government was settled in 1997 with the accounting firm agreeing to pay an estimated $35 million.
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In 1978, DeLorean Motor funnelled $17.6 million of corporate funds to a Panamanian company. Published reports claim about $8.5 million of the money was then transferred to an account controlled by John DeLorean.
May 26-June 1, 1999