ANALYSIS:Lowry's 1996 statement to the Dáil will colour the reception of his declarations this week
MICHAEL LOWRY’S difficulty when passionately claiming that the Moriarty tribunal’s findings against him are wrong is that he has a record for making definitive statements that later transpire to be mendacious.
Furthermore, it is difficult for him to defend his character when you consider his dealings in relation to his tax affairs.
Lowry gave sworn evidence to the tribunal on October 30th, 2001, about £147,000 he lodged to an Isle of Man account in October 1996. At the time he was a government Minister and a senior figure in Fine Gael.
In the summer of that year he got a 100 per cent loan from Michael Fingleton of Irish Nationwide to buy a house on Carysfort Avenue, Blackrock, Co Dublin. The house cost £200,000 and was in need of renovation. The loan was approved by Mr Fingleton the day after Lowry asked him for it.
At the time Lowry already had £140,000 sterling lodged offshore which had come from Ben Dunne and others. It was enough to pay for the renovation. He discussed using this money on the house with a businessman, the late David Austin, who was occasionally involved in Fine Gael’s fundraising activities.
Austin was resident offshore but had a home in Blackrock. Lowry performed an official function in south Dublin one summer’s evening, and then went to see Austin. He told Austin he had money offshore but was worried about using it for the renovation. “At that particular time, I was conscious of the possible potential tax liability arising from my dealings with Ben Dunne,” he told the tribunal.
It was then, according to Lowry, that Austin suggested he would lend him the money, which he did. This allowed Lowry leave the £140,000 he had in the Channel Islands where it was.
From this version of events it was just a coincidence that the money Austin gave to Lowry had been given to Austin some months earlier by Denis O’Brien, who had moved it from an account in the Isle of Man to an account of Austin’s in Jersey.
Mr Justice Michael Moriarty opted not to believe Lowry, or O’Brien, and decided the money was a payment from O’Brien to Lowry. Austin died in 1998.
Lowry opened an account with Irish Nationwide in the Isle of Man to receive the money he got from Austin. He gave his address as care of Butler Brophy Thornton accountants, Dublin. In November 1996, Lowry had to resign, and in February 1997 he returned the £147,000 to Austin on the day the McCracken (Dunnes payments) tribunal was established.
He resigned after it was revealed that Dunnes Stores had paid for work on his Tipperary home. On December 19th, 1996, Lowry was allowed make a personal statement to the Dáil. He said he wanted to “set the record straight”. He had not been trying to hide income he got from the Revenue: “If someone were trying to hide income, would he or she not be more likely to put it in an offshore account?”
The statement was made just two months after he had opened his account in the Isle of Man. He also at the time had the account in the Channel Islands.
He had opened this account, with AIB Channel Islands, in January 1991, by going into AIB on O’Connell Street, Dublin, and making an opening lodgement of £55,000 sterling. The account was in his name and that of his three children.
Lowry had availed of the 1993 tax amnesty. To avail of it but not make a full disclosure would be deemed a criminal offence.
Yesterday, Lowry was asked by The Irish Times about the origin of the money he declared to the amnesty. He said his tax affairs were his own private concern.
Lowry did not disclose the existence of the Isle of Man account to the McCracken tribunal. He only disclosed its existence to the Moriarty tribunal after it started to look at transactions in accounts belonging to Austin.
Lowry’s accountant, Denis O’Connor of Brophy Butler Thornton, told the tribunal he had not known in 1996 that Lowry had used his firm’s address when opening the account. He first learned of the account in 2001.
O’Connor was among the advisers who assisted Lowry draft his personal statement to the Dáil in 1996.
In September 2007, tax settlements totalling €1.45 million were listed in Iris Oifigiúil in relation to Lowry and his refrigeration company Garuda, which supplies services to Dunnes Stores. Garuda paid €1.26 million and Lowry made a settlement of €192,120.
The Moriarty tribunal was given doctored documents that Mr Justice Moriarty decided were designed to mislead the tribunal in its inquiries into property deals in England involving Lowry.
Lowry was one of the people involved in this exercise, according to the judge in his report. A man who knew what was going on, Kevin Phelan, was paid by Lowry not to tell the tribunal. Phelan was encouraged to produce a false explanation for a document causing trouble for Lowry, as part of “a choreographed falsehood” that was “orchestrated by [Denis] O’Connor and Lowry with the objective of misleading the tribunal”, the judge said in his report.
FINE GAEL LEGAL ADVICE:
TRIBUNAL CHAIRMAN DISAGREED WITH SC OVER ADVICE ON TELENOR DONATION
THE CHAIRMAN of the Moriarty tribunal did not agree with legal advice received by Fine Gael in March 1998.
The advice, by James Nugent SC, was that $50,000 given to Fine Gael in 1996 following a fundraising dinner in New York, did not come within the terms of reference of the tribunal and was not a payment to Michael Lowry.
However, Mr Justice Michael Moriarty decided otherwise. Mr Lowry was at the time chairman of the trustees of Fine Gael, and the property and assets of the party were vested in the trustees.
The New York dinner was arranged by David Austin and the payment followed a request by him to Denis O’Brien. The payment came from Norwegian company Telenor, O’Brien’s partner in his Esat Digifone consortium. It was paid to Austin who lodged it with the Bank of Ireland in Jersey.
Once the cheque was lodged, Mr Justice Moriarty decided, it was held in trust in favour of the trustees, who included Mr Lowry, and so was lodged to an account that held funds for his benefit.
The legal advice from Mr Nugent was commissioned by Fine Gael after it was approached by Telenor in February 1998.
In January, Telenor had asked its Irish solicitors if it should disclose the existence of the donation to the tribunal. It then enlisted public relations consultant Fintan Drury to set up a meeting with Fine Gael, as it wanted confirmation that the party had received the money from Austin.
Mr Justice Moriarty said it was “regrettable” that Fine Gael had not disclosed the matter to the tribunal.