The Mahon tribunal: The former Fianna Fáil TD, Mr Liam Lawlor, received an under-the-counter payment of almost €200,000 in part-payment for the sale of his land to a leading property developer, the tribunal has heard.
The developer, Mr Michael Whelan, of Maplewood Homes, yesterday contradicted Mr Lawlor's version of why this money was paid to him though a London legal firm.
He claimed Mr Lawlor originally sought £200,000 cash "under the table" for selling one acre of his land, but settled for a cheque for £100,000 sterling plus VAT, paid in the UK.
Mr Lawlor denied the allegation but conceded that some of the evidence he had given concerning the transaction was incorrect. He claimed the sterling sum was paid for property advice he provided for Mr Whelan, but later conceded there was some "overlap" with the property transaction.
However, the tribunal chairman, Judge Alan Mahon, suggested Mr Lawlor's explanation was a "sham" to cover up the £100,000 payment for the land. By not declaring the full price on the contract, Mr Lawlor was defrauding the Revenue, he suggested.
Of the £825,000 Irish price agreed between the two men for the purchase of one acre of Mr Lawlor's land at his home in Lucan, £117,000 sterling was paid to the politician in London and another £3,500 Irish was paid in cash. Yet the stated price on the contract was £690,000 Irish.
Mr Lawlor claimed the idea of channelling some of the money through the UK was Mr Whelan's, but said he was "easy either way" whether the money was paid in Ireland or Britain.
He denied defrauding the taxman. He brought back half the amount to Ireland, and his accountant would be declaring the full amount, he said.
Judge Mary Faherty asked why a property developer would ask an Irish politician to source properties in the UK.
Mr Lawlor said his business acumen went beyond politics. He had run a successful company before going into politics and he had extensive experience of property and development in the Czech Republic and elsewhere.
In his evidence, Mr Whelan described how he came to acquire the acre of the politician's land in Lucan.
He said Mr Lawlor called in to see him when he was building in the area. He offered to sell an acre of heavily overgrown land near his house, Somerton. The two men agreed a price of £820,000-825,000 Irish. Mr Lawlor indicated he wanted some cash as part of the deal, Mr Whelan said.
In April 2000 Mr Lawlor sent a contract specifying a purchase price of £620,000 Irish to Mr Whelan's solicitors. This left a difference of about £200,000. "There was no way I had £200,000 in cash to give anybody," Mr Whelan said. He told Mr Lawlor he could pay him £100,000 sterling through one of his companies in England.
Mr Lawlor discussed the matter with a fellow director, Mr John Barrett, and it was agreed that the £100,000 sterling would be paid through Lunar Sea Development, an Irish-registered company with property interests in England.
In July 2000 Mr Lawlor issued a new contract, this time for £690,000 Irish. This specified a 20 per cent deposit, as opposed to the 10 per cent specified in the previous contract. "Mr Lawlor needed money to pay bills, and I agreed," Mr Whelan explained.
The cheque for £100,000 sterling was issued to a client account in Seddons, Mr Lawlor's legal firm in London and Prague, in September 2000.
Mr Whelan and Mr Lawlor then had a disagreement over the balance due, stemming from the use of differing exchange-rate calculations.
Mr Lawlor claimed he was due £11,000 Irish, but eventually settled for a cash payment of £3,500, which was paid a week later.
A problem over legal documents caused a delay in completing the sale, and Mr Lawlor issued a second contract, again for £690,000 Irish, in November 2001. This was 14 months after he had been paid the £100,000 sterling and £3,500 in cash.
Mr Whelan said the true purchase price was £820,000-825,000.
Asked about Mr Lawlor's claim that the developer had agreed to pay him 1 per cent of property he helped him acquire in London, Mr Whelan said this was not true. Mr Lawlor had never provided him with property advice in England. He never had any dealings with Seddons.
Asked whether Mr Lawlor had sought cash under the table to be paid out of the jurisdiction, Mr Whelan said he had. However, Mr Lawlor intervened to say he had not asked for cash. A cheque would have been just as acceptable.
Mr Barrett, a director of Mr Whelan's company, Maplewood Homes, said he gave Mr Lawlor a blank cheque to cover the £100,000 sterling payment. He required paperwork in the form of an invoice to cover the transaction.
Mr Barrett conceded that he "prompted" Mr Lawlor by telling him that the company had acquired property in Piccadilly, London. "I suggested it might provide him with some assistance."
When VAT was added, the invoice to complete the payment came to £117,000 sterling, and Mr Barrett paid a second cheque for £17,000 to Seddons to cover the balance. Both cheques were given to Mr Lawlor.
Asked if the sterling sums paid to Mr Lawlor had anything to do with the purchase of the property in Piccadilly, he said they hadn't. A finder's fee of £25,000 sterling had been paid to another company in relation to the acquisition of this building.
Answering questions from Mr Lawlor, Mr Barrett admitted that he provided the politician with a brochure for the Piccadilly property.
He had to come up with some solution to account for the payment in the books, he told Judge Mary Faherty.
