Dunlop claims AIB invited developer

Mahon tribunal:Cork developer Owen O'Callaghan was invited to become involved in the Quarryvale project by Allied Irish Banks, the tribunal was told yesterday.

Lobbyist Frank Dunlop appeared to back up allegations made by developer Tom Gilmartin that AIB was responsible for bringing Mr O'Callaghan into the Quarryvale project, to develop the Liffey Valley shopping centre in west Dublin.

AIB had lent £8.5 million to Mr Gilmartin to buy land at Quarryvale in February 1990. The loan was for a six-month period and the bank became concerned when it appeared Mr Gilmartin would not be able to repay it within the agreed time.

Mr Gilmartin had alleged that everything he told the bank was passed on to Mr O'Callaghan. However, the bank has denied talking to anyone about Mr Gilmartin's personal affairs without his permission.

Ms Dillon asked Mr Dunlop yesterday if he knew how Mr O'Callaghan had become involved in the Quarryvale project. Mr Dunlop said he understood Mr O'Callaghan had been invited by AIB into the project "in circumstances where AIB was concerned about the level of investment it had made and the possibilities of failure".

Mr Dunlop also told the tribunal that he understood senior AIB official Eddie Kay was moved from his position in the bank in 1992 as a result of his involvement in the Quarryvale project.

Mr Kay had worked closely with Mr Gilmartin when he secured the loan for Quarryvale.

Mr Dunlop said it was his view that Mr Kay was moved from his position as a result of his involvement in the project, which looked like it might go "belly-up".

"AIB would have quite an amount of difficulty explaining how it had lent . . . eight to 12 million to an individual to develop a project in west Co Dublin," he said.

Mr Dunlop came under pressure in relation to photocopies of his diary provided to the tribunal. In April 2000, he provided edited copies of his diary highlighting issues in relation to Quarryvale, as requested by the tribunal. He subsequently provided the original diary, in October 2001.

Ms Dillon queried various differences between the edited version and the original. She pointed out two entries in the original diary in October 1991 which showed meetings between Mr O'Callaghan and then minister for the environment Pádraig Flynn. She asked Mr Dunlop why he had decided to remove that information when he sent his edited diary to the tribunal.

Mr Dunlop said he didn't deem it was relevant.