The billionaire, the minister and a deal shocking the Republic of Ireland
After a 14-year corruption inquiry into the sale of a mobile-phone licence, the real feud is just heating up
Published 24/03/2011 | 00:00
For a man previously labelled as corrupt, former Irish government minister Michael Lowry has proved remarkably successful at the ballot box.
In Tipperary, where he lives in a detached home (with a fine extension built courtesy of a grateful supermarket tycoon for services rendered) he remains highly popular, and secured one of the largest personal votes in the country in the last elections.
But will his supporters accept his latest staggering fall from grace? A report into irregularities at the highest level of Irish political and financial life is crushingly critical of his conduct and values. It accuses Mr Lowry of fixing the award of a mobile phone licence which, worth hundreds of millions of pounds, was the biggest contract ever awarded by an Irish government to a private company.
It described another of Mr Lowry's dealings while a minister as "profoundly corrupt to a degree that was nothing short of breathtaking". It depicted him as a minor version of Charles Haughey, the former prime minister regarded as the titan of Irish corruption. It declared: "In the cynical and venal abuse of office and the brazen refusal to acknowledge the impropriety of his financial arrangements, Mr Lowry displayed qualities similar in nature, and has cast a further shadow over this country's public life."
In today's Ireland, the report produced no real sense of shock since the universal belief is that dubious dealings have become embedded in public life. The most tangible sign of this came in the recent general election when Fianna Fail, the party most associated with corruption and financial incompetence, suffered a collapse in its support.
The oddity is that Mr Lowry was a member of another major party, Fine Gael, at the time of his alleged malpractices. He left the party in a previous round of controversy centring on tax avoidance and accepting favours from a business figure.
Fine Gael, which is regarded as more scrupulous than Fianna Fail and now heads the new coalition government, has been splashed by a little of the mud from the Lowry affair.
Mr Lowry and the various business figures involved absolutely reject the conclusions reached by Mr Justice Moriarty in his report on events in the mid-1990s.
Its 2,000 pages paint a picture of Mr Lowry making sure that the licence went to Denis O'Brien, the dynamic businessman then on his way to becoming the 254th richest figure in the world. This process was followed by large-scale monetary transactions in Mr Lowry's favour. As minister for communications he was in overall charge of the lucrative mobile phone licence. He was, however, required to keep himself at arm's length from the process, which was carried out by a civil service committee.
The judge found, however, that the minister had given Mr O'Brien "substantive information of significant value and assistance to him in securing the licence", and had "irregular interactions with interested parties at its most sensitive stages". By doing this he had exercised an "insidious and pervasive influence".
The judge rejected Mr Lowry's argument that he had been "an encouraging but disinterested minister", as he rejected other evidence from him as "formulaic, evasive and unhelpful".
At the same time, O'Brien companies were said to have made donations to Fine Gael, both directly and in the form of fundraising events.
The judge, in common with other inquiries in Ireland and elsewhere, made a point of following the money. In doing so he reported that three large sums of money, starting less than two months after the licence was granted, went from Mr O'Brien to Mr Lowry. Two of these were payments while the third was support for a loan. In total these amounted to almost £900,000. One amount, of £147,000, made its way from Dublin to the Isle of Man, then Jersey and back to the Isle of Man, where Mr Lowry opened a bank account to receive it. During its travels it passed through accounts held not by Mr O'Brien but by his associates. Linking this to the awarding of the licence, the judge concluded that the payments were "demonstrably referable to the acts and conduct of Mr Lowry in regard to the process".
The judge said the money was later "hastily repaid" by Mr Lowry because of a fear that it would be uncovered by another tribunal of investigation. The report was highly critical of the former minister's personal banking arrangements, saying he had 19 accounts, some of them offshore. It remarked that there was a want of transparency in his details and that his bookkeeping was palpably inadequate.
The judge also reported that Mr Lowry and others involved in his dealings had engaged in "persistent and active concealment" which included the altering of documents submitted to the tribunal. The judge used the word "corruption" only in connection with Mr Lowry's dealings with Ben Dunne, whose family owned the major supermarket chain Dunne's Stores. A previous inquiry concluded that the businessman had funded a major extension to Mr Lowry's home.
The judge said that Mr Lowry had sought to have the rent payable to Mr Dunne by a state company, Telecom Eireann, increased by £40,000 a year. He said this move, which was unsuccessful, would have "improperly enriched Mr Dunne and thereby burdened public funds".
Some of those criticised in the report are threatening to take legal action, while Prime Minister Enda Kenny said the authorities are referring its findings to the police and Director of Public Prosecutions.
The exercise has already cost Ireland a fortune, eating up an estimated €250m (£217m) over 14 years. The tribunal heard 384 days of evidence, with three of the senior lawyers involved together earning €25m.
Despite the huge volume of evidence and the legal complexities, the report's narrative is simple enough, with Judge Moriarty essentially accusing the one-time minister of influencing government decisions for personal gain.
Mr Lowry rejected the judge's commentary, describing the report as "blatantly and disgracefully wrong". The recurring criticisms of him over the years have caused no damage to his political career, since he has several times been re-elected to the Irish parliament.