Furze note reveals Irish-Cayman tax evasion plan

The full extent to which the late Mr John Furze colluded with the Irish financial community to hide funds from the Revenue authorities is revealed in the text of a note sent to him in 1983. It shows how Mr Furze and an Irish individual who clearly was in control of substantial amounts in client funds planned to take extensive steps to hide funds in discretionary trusts in the Cayman Islands.

The note gives little clue to the identity of its author. However it does say in one section that a bank in Ireland could swear to the Revenue as to the non-connection, in a legal sense, between any parties the Revenue may investigate and any legal trust.

The above reference comes in the final section of the note which states that because the assets are contained in a trust, they are not the legal property of the beneficiary. It then goes on to state that the Irish bank can swear to the non-connection, although the bank's role is not explored any further.

The existence of the "Note to John Furze" was first revealed in an affidavit presented to the High Court on behalf of the Tanaiste, Ms Harney. Leading stockbroker Mr Kyran McLaughlin was questioned about the note by the Moriarty tribunal last Friday. Mr McLaughlin has said he was not the author of the note, but that a copy was given to him by Mr Furze when they met. He said that neither he nor any clients of Davys had anything to do with the scheme.

The note is effectively an outlining of the workings of the discretionary trusts system by a senior member of the financial community in an apparent attempt to clarify the issues involved with Mr Furze.

It goes into great detail about how such a scheme would be established and how the beneficiary would effectively be able to manage the money by giving instructions to trustees.

Instructions would usually be given by telephone, it said, and "telephonic recognition" of the client's voice would normally be sufficient.

The note examines how money could be paid out of the trust and through another company to a mythical "Billy Bloggs." It notes that if Mr Bloggs did not declare the money, then he would be in breach of exchange control and taxation rules.

The note goes on to detail the small number of people who would know about the operation of the trusts and, as outlined in the affidavit of Ms Harney's official, how this identity could be kept hidden.

It also details how beneficiaries can be added after the establishment of the trust through the donation of $10 to the Red Cross. This comes in the infamous "Towards Minimising the Footprints" section of the document which goes into great detail about how the information can be hidden from the Revenue.

If the client held money coming from the trust offshore, then it was less likely to ever be discovered, the note says. The difficulty if the link was ever discovered would be that the tax official could query where the money came from in the first place.