Lowry case told Revenue keen to ask ‘pertinent’ questions

The DPP has incorrectly placed "centre stage" an Appeals Commissioner finding that Michael Lowry misappropriated €372,000 from a company of his in 2002, the High Court has heard.

The commissioner, in a July 2015 determination, said there was “evidence” of the funds being misappropriated but later, apparently referring to the word “misappropriated”, said he was not using that word in a “perjorative” sense, Patrick Treacy SC, for Mr Lowry, said.

A suggestion on behalf of the DPP that Mr Lowry could be subject to a new tax assessment raised against him by Revenue came as “a complete surprise”, Mr Treacy added.

If convicted in his criminal trial on mainly tax-related charges, Mr Lowry could face “very serious consequences” as the charges attracted penalties of up to five years jail and a person jailed for more than six months cannot serve as a TD, he added.

Counsel was making closing arguments in Mr Lowry's judicial review aimed at stopping his trial before Dublin Circuit Criminal Court. Mr Lowry denies allegedly filing incorrect income tax returns for the year 2002 and conniving in alleged delivery by his company Garuda of incorrect corporation tax returns for the years ending 2002 and 2006.

He denies a further charge, brought under the Companies Acts, of wilfully causing a company to fail to keep proper books of account between August 28th, 2002 and August 3rd, 2007. The trial has been stayed pending the judicial review outcome.

The five charges arise from a 2002 transaction involving a €372,000 payment due to Garuda being diverted to an Isle of Man trust account nominated by Omagh accountant Kevin Phelan.

Mr Lowry says he self-declared and self-corrected the matter in 2007, the Appeals Commissioner found he had no personal income tax liability, Garuda ultimately paid some €38,000 corporation tax and the only outstanding issue is a disputed surcharge liability of €2,410. The DPP contends the matter is significantly more serious than that.

The judicial review concluded on Friday and Mr Justice Seamus Noonan reserved judgment.

During Friday’s hearing, Remy Farrell SC, for the DPP, suggested Mr Treacy should read more from the Appeal Commissioner’s determination, exhibited in court documents but not read in full in court by either side.

Mr Justice Noonan previously dismissed Mr Treacy’s arguments the DPP was not entitled to exhibit the full determination after finding Mr Lowry waived his right to confidentiality over the document by relying on parts of the determination in his judicial review.

In arguments earlier on Friday, Mr Farrell said Mr Lowry had complained he was not interviewed about the 2002 transaction before the DPP initiated the criminal prosecution in 2014.

The failure to interview was linked to the fact the time limits for prosecution had almost expired, there was no legal requirement to interview and there was no unfairness involved, counsel outlined.

If Mr Lowry wants to be interviewed, the Revenue were likely to be keen to ask "pertinent" questions of him arising from the Lowry tapes – a purported recording of a conversation between Mr Lowry and Kevin Phelan concerning the transaction, details of which were published in the Sunday Independent in February 2013, counsel said.

The Revenue door was “always open”.

Mr Farrell also rejected as irrelevant and unsustainable arguments it was oppressive to prosecute Mr Lowry when holders of offshore Ansbacher accounts have not been prosecuted. The time for prosecuting many holders of Ansbacher accounts, which date to the 1970s, had run out by the time the Revenue learned of the accounts, he added.

Counsel also submitted Mr Lowry’s challenge to the decision to move his trial to Dublin amounted to an attempt to secure an “unfair” trial before a Tipperary jury whom he thought would be “more sympathetic” to him.

Mr Farrell said he himself is “a proud son of south Tipperary” who had never argued a Tipperary jury could not be trusted.

What Mr Lowry wanted was a trial where “the cards are stacked against the DPP” with a jury diverted into inquiring whether Mr Lowry is “a good egg who has done the State some service”.

In his reply, Mr Treacy argued Mr Farrell had sought to hold his client up to “caricature” and “ridicule” and to make Mr Lowry’s case sound “preposterous and ridiculous”.

Mr Farrell failed to make a single concession, including that the original Revenue assessments that Mr Lowry and Garuda had a global tax liability of €1 million were wrong, counsel said.

A prosecutor’s function was to ensure evidence is properly placed before a court, not secure a conviction but the intention here was Mr Lowry be “got at all costs”, he said.

The decision transferring the trial to Dublin involved errors of law and breach of fair procedures, he submitted.