Haughey believed broker invested in company

Last week the Moriarty tribunal heard that in November 1992 three Dunnes Stores cheques, made out to cash, were deposited in the account of a property development company, Carlisle Trust, on the instructions of the late Mr Des Traynor.

At the same time two cheques for the same amount were drawn on the account, again on Mr Traynor's instructions. One was for £100,000, dated November 24th and made out to Celtic Helicopters.

Yesterday Mr Ciaran Haughey, a founder-director and company secretary with Celtic Helicopters, said Mr Traynor handed over the cheque which was lodged in his company's account on November 27th, 1992. He had not noticed that the cheque came from Carlisle Trust.

He believed the money was part of an investment of more than £290,000 made by five investors found by Mr Traynor.

Mr Haughey said Mr Traynor told him the £100,000 was an investment by Mr Michael Murphy, an insurance broker with an address at Trinity Street, Dublin, who sold insurance to Celtic Helicopters.

Much of yesterday's evidence was concerned with trying to clear up how the £100,000, seemingly from Mr Ben Dunne, ended up being attributed to Mr Murphy.

Mr Murphy, in his evidence, said he had been asked by Mr Haughey's colleague in Celtic Helicopters, Mr John Barnacle, to find investors.

He got Mr David Gresty, of D.B. Agencies, Monaco, to invest £100,000. Mr Gresty did business with Mr Murphy, and the money was to come by way of writing off a debt.

A cheque for £100,000 from Mike Murphy Insurance Brokers was lodged to the Credit Suisse bank, Zurich, "to the account of Ansbacher Bank account number 0835/945743/64", according to a letter dated November 4th, 1992.

Mr Murphy wrote the letter that apparently accompanied the cheque when it was sent to Credit Suisse bank, London. The date on the letter is 20 days earlier than that on the Carlisle Trust cheque for £100,000, and 23 days before £100,000 was lodged to the Celtic Helicopters account. Mr Murphy said Mr Paul Carty, of Deloitte & Touche, instructed him to send the £100,000 cheque to the Swiss account.

A letter from Mr Gresty was produced seemingly showing him acknowledging he had received a payment which included Mr Murphy's £100,000 cheque. The letter, dated October 5th, 1992, continued: "I have forwarded cheque as agreed for the investment in Celtic Helicopters."

Last night Mr Gresty told The Irish Times he had invested £100,000 in Celtic Helicopters and it was one of several investments he had made through Mr Murphy. "This was not a very good one, to be honest." He said he was co-operating with the tribunal.

In evidence Mr Haughey told Mr Jerry Healy SC, for the tribunal, that in 1985, when Celtic Helicopters was being set up, he knew Mr Traynor was gathering investment for the company, but did not discuss this with him.

Mr Traynor did not disclose the investors' identities. He did not know Dr John O'Connell had invested £5,000 until he received a letter from Dr O'Connell in 1992. He had never approached Dr O'Connell for an investment.

When Mr Traynor raised the £290,000-plus in late 1992, the names of the five individuals were disclosed to Mr Haughey. Among them was Mr Murphy. No share certificates were issued and the funds were treated as "loan capital" in the accounts. When the company then sought a loan from Smurfit Paribas in 1996, the bank refused it as long as the company still had the £290,000 loan on its books.

The loan capital, which Mr Haughey said was always really share capital, was then converted into share capital. The tribunal displayed a letter to Deloitte & Touche instructing it to do this and signed by Mr Haughey. "Please prepare the documentation necessary to convert an existing loan in the amount of IR£290,239 into non-cumulative preference shares of £1 each," the letter read.

Mr Healy put it to Mr Haughey that there never was a loan and Mr Haughey said he agreed.

A letter to Celtic Helicopters was enclosed with the one to Deloitte & Touche. It was from Larchfield Securities, Kinsealy, Co Dublin.

The letter states that Larchfield gave a £290,000-plus loan to Celtic Helicopters and instructed that it be converted into preference share capital.

From Mr Haughey's evidence, which was at times unclear, it seems those who invested in 1992 had their stake held for them by Larchfield Securities. The tribunal has heard that the beneficiaries of Larchfield were Mr Charles Haughey's children.