Alleged £2m fraud discovered at Dr Quirkey’s Good Time Emporium

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An alleged €2million fraud has been uncovered at the company that operates arcades and casinos, Dr Quirkey’s Good Time Emporium on O’Connell Street in Dublin.

The shocking revelation is contained in Dublin Pool and Juke Box Ltd’s new consolidated accounts which show the alleged misappropriation of funds to the arcade and casino operator amounted to €1.017 million in 2019 and €1.009 million euros in 2018.

The business is owned by businessman, Richard Quirke, who is Rosanna Davison’s father-in-law and has long been linked to £480million plans for a major development, including a casino, in Two Mile Borris in County Tipperary.

The 75-year-old has amassed a considerable fortune through his Dublin-based casino business with shareholder funds totaling 33.6 million euros. Most of the company’s assets are concentrated in real estate, the book value of which amounted to €34.3 million at the end of June 2019.

However in the newly filed 2019 accounts, the directors reveal in their report that “in December 2020, the company discovered that it was the subject of corporate fraud”.

The company calculates the cost of the alleged fraud at €1.017 million in 2019 and €1.009 million in 2018 and has canceled the amounts.

The breakdown of alleged fraud in 2019 consists of €887,000 of alleged “embezzlement of cash” and alleged “diverted bank payments” of €130,190.

Under “exceptional items”, the breakdown of the cost of the alleged fraud in 2018 is €912,000 under alleged “misappropriation of cash” and €97,203 under “embezzled bank payments”.

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Dr Quirkey’s Good Time Emporium on O’Connell Street in Dublin

Dr Quirkey’s Good Time Emporium on O’Connell Street in Dublin

A note attached to the “exceptional fact” states that “in December 2020, the directors uncovered financial fraud perpetrated on the company through fraudulent bank payments. The payments have been canceled in the financial statements as an exceptional item”.

Regarding the alleged misappropriation of cash, the trustees state that “in December 2020, the trustees also uncovered activities involving misappropriation of cash.”

Describing the company’s response to the alleged fraud, the directors state that following the discovery of the alleged fraud, “a thorough and comprehensive forensic investigation by external financial consultants into the company’s systems and processes was been conducted”.

The directors specify that “this led to the identification of unpaid taxes and interest which were fully provisioned in the company’s accounts”.

The accounts reveal that €296,813 of interest was paid on overdue tax in 2019 and €154,784 was paid under the same heading in 2018.

The directors say that following the investigation by the external financial consultants “the company has implemented an extensive and extensive program of governance and operational improvements at all levels of the organization”.

Directors say these include new manual and electronic systems to manage cash management in the business; new security measures for the handling and collection of cash and new management control systems.

Other improvements include rigorous new recruitment processes and enhanced training programs for employees in all roles and at all levels of the business, as well as new employment and management appointments in key areas such as human resources, accounts and operations.

The director status improvements also include the appointment of new directors to the board and on February 4 this year, Debbie Lawrence, Andrew Quirke and Austin Kenny were appointed to the board.

The company’s annual report lists Ms. Lawrence as CEO and Mr. Kenny as accountant.

They sit on the board with the director, Andrew Quirke joining Richard Quirke and Anne Quirke.

In a separate development under “contingent liabilities,” a note says the company “is currently undergoing an earnings investigation, the outcome of which is currently uncertain.”

The note states that “the directors have provided for additional liabilities and interest in the financial statements but have not provided for potential penalties that may arise.”

The end of June 2019 accounts were due to be filed in 2020 but were not signed until March 8 this year.

The alleged fraud contributed to the company recording pre-tax losses of €1.27 million in the last 12 months to the end of June 2019 and this follows pre-tax losses of €1.03 million euros during the 2018 financial year.

The company’s post-tax loss in 2019 was €1.45m and in 2018 was €1.26m. The 2019 loss also takes into account combined non-cash depreciation charges of €1.2m and a loss of €117,558 on the sale of property, plant and equipment.

The performance of this company before Covid shows that its revenues increased by 33%, from 7.57 million euros to 10.106 million euros in 2019, as the activity developed.

The 2019 loss also takes into account a non-cash impairment of €700,000 in the company’s investment property portfolio.

The number of employees increased from 57 to 86, with personnel costs increasing by 40.5%, from €4.3 million to €6.04 million. Directors’ compensation amounts to €213,000 for 2019.

During 2019, the company’s cash flow increased from €2.37 million to €3.99 million.

Regarding the impact of Covid-19, the directors state that the pandemic has had a severe impact on the business and as a result the business has been unable to generate revenue.

They state: “Now that the Covid-19 restrictions have been lifted, the directors are confident that the business will fully recover and result in strong liquidity.” Directors state that the company promotes responsible gaming.

A Garda spokesperson said on Sunday that “An Garda Síochána does not comment on named entities” when asked if a complaint had been received regarding the alleged fraud.

Dr. Quirkey’s Good Time Emporium did not respond to request for comment on Sunday.

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