Senator claimed tribunal was tapping Dunlop's phone

Senator Don Lydon warned Mr Frank Dunlop to be careful about what he said on his telephone because it was being tapped by the Flood tribunal, it was claimed today.

The warning was allegedly made in a car outside St John of God's Hospital, Stillorgan, Co Dublin, where Mr Lydon was a senior consultant, just after the tribunal was established in 1997.

Mr Dunlop recounted the tale this afternoon while contradicting a statement furnished to the tribunal by Mr Lydon, in which the Fianna Fáil senator denied ever receiving any payments for the purposes of securing his support for planning decisions.

In the statement, Mr Lydon admitted receiving two payments, one of £420 or £430 in 1991 for the local council elections and the second for £1,000 for the Seanad elections of 1993. He said he only remembered the second when Mr Dunlop telephoned him to warn him the tribunal was aware of it.

Mr Dunlop, although he confirmed these two payments were "legitimate political contributions", insisted Mr Lydon had in fact phoned him, and was anxious to discuss the tribunal's investigations.

Mr Dunlop said they arranged a meeting, which took place in the carpark of the hospital. "He wanted to warn me that the tribunal was tapping my phone and to be careful about what I said," particularly about politicians, Mr Dunlop claimed.

He said he dismissed the story as fantasy. "I know, take it from me Frank, that is what's happening," Mr Lydon allegedly retorted.

In response, Mr John Gallagher, for the tribunal, dryly dismissed the charge. "Let me assure you, Mr Dunlop, that your phone has not been tapped," he said, adding that no other party had been targeted either.