(CNS Business): Following a ruling last week in the Cayman Islands Grand Court by Sir Peter Cresswell, the developer of the Ritz Carlton, Michael Ryan, has denied any wrongdoing, claiming it is he who is owed millions of dollars and that he intends to fight the case against him and pursue his counter claims to the end. Denying that he had taken any money from the companies relating to Cayman’s five-star resort, Ryan stated that he is the one being wronged in what is becoming a complex dispute and described the actions against him by the receivers as “surprising and desperate”, which he said would be revealed in his defense due to be filed in the courts next month.

In a statement to the press on Monday, 8 October, following what in his opinion were “misleading” reports, Ryan said that the allegations against him were based on “misreadings of bank statements”. The former owner of the Ritz did not indicate which news reports he felt were misleading or in which publication but added that, while he not wish to try legal disputes in the press, some things needed clarification.

The first report of the Cresswell ruling appeared on the website of the Miami-based watchdog Offshore Alert, which was followed by a story on CNS Business last week. Since then, other news houses have reported on the revelations in the court ruling, including The Caymanian Compass, which ran a lead story on Friday which attributed statements by Ryan’s attorneys to the judge, followed by a different version of the story on Monday with the correct attributions on page 9.

In the ruling delivered by Cresswell Ryan was accused by the receivers of taking some $44 million from the various companies associated with the resort that have not been properly explained. Ryan has denied that this was the case and his lawyers have accused the receivers of assuming that something that is unexplained must be wrong.

Contrary to the claims by the receivers and RC Cayman, which is the company taking action against Ryan in pursuit of a debt of over US$250 million, the former owner says that it is he that is owed millions after working for free and lending the companies money. Most of the companies involved in the ownership of the Ritz, however, were predominantly owned by Ryan – a point noted by the judge in his ruling.

“I was left being owed millions of dollars of outstanding salary, fees and loans I personally made to the companies,” Ryan said in his press statement Monday. “The first thing I was told by the receivers and their attorneys was that they would not honour any of the obligations to me or my companies.  They then started legal proceedings against me, less than a month after the date of their appointment.” He added that these allegations against him were based on select company bank statements that had been misread. 

“Ernst and Young has been auditing the companies for years and the accounts are there to be seen by the receivers. Had I been systematically taking millions from the companies then the auditors might have been expected to notice,” Ryan said. “In light of this I find the receivers’ approach both surprising and desperate, as will be demonstrated in the defense that is due to be filed next month.”

Stating that he intended to pursue his defense and counter claims to the end, Ryan said he was confident that people would see that he devoted all his efforts to seeing the project survive and acted properly at all times. “I am the one who has been wronged and is owed funds from the project,” he said.

Ryan added that for the last fifteen years he had devoted himself to the creation and operation of the Ritz with the goal of creating the finest resort in the region. He said that over a billion dollars of economic impact was delivered and thousands of jobs created. “As the world has struggled through the current economic crisis I did everything possible to maintain the value of the project, its reputation and also the reputation of Cayman,” Ryan stated.

“I worked without pay for many years and invested funds to try and keep the project going while working on a restructuring of the project debt,” the former owner said.  “These efforts were unsuccessful and the lender controlling the senior debt stack, Five Mile Capital, decided, with no advance notice, to place the properties in receivership, something I heard about after it was announced in the press.”

Ryan said he believed that the majority of people agreed with him, “notwithstanding the salacious pleasure some people get from seeing someone’s name smeared,” he noted, adding that there are two sides to every story.
See full press statement below.

Related articles:

Ryan moved $44m from Ritz (October 2012)

Ritz goes on auction block (September 2012)

Ritz-Carlton faces takeover (February 2012)