Moriarty says Lowry helped O'Brien win mobile licence

 

The Moriarty tribunal's second and final report has found that Michael Lowry assisted Denis O'Brien in his bid to secure a mobile phone contract for Esat Digifone.

It concluded it is “beyond doubt” that then minister for transport, energy and communications Mr Lowry gave “substantive information to Denis O'Brien, of significant value and assistance to him in securing the [mobile] licence”.

It said Mr Lowry and Mr O'Brien had at least two meetings during the bid process at which the former minister "imparted substantive information to Mr O'Brien of significant value and assistance to him in securing the licence".

During the first meeting, the tribunal found that Mr Lowry proposed France Telecom to Mr O'Brien as a potential partner, on the basis that the telecoms firm had an interest in forming a consortium to bid for the licence.

The tribunal says while this did not ultimately bear fruition, it showed Mr Lowry to be "indiscreet and less cautious in dealings with interested parties than might have been expected".

At the second meeting between the two men, which was held in September 1995, Mr Lowry is reported to have told Mr O'Brien that Esat Digifone was in pole position in the competition but warned him of concerns about the company's financial footing.

These discussions reportedly allowed Mr O'Brien to continue negotiating with Dermot Desmond about joining Esat Digifone though his investment vehicle IIU, according to the report.

It says the "most pervasive and abusive instance" of Mr Lowry's influence on the awarding of the mobile licence was his decision to withdraw time from the project group when they requested an extension to their work because it was not convinced the firm should be nominated as winner of the process.

The report goes on to say that Mr Lowry deprived Cabinet colleagues of an opportunity to scrutinise and review the result and sought to overreach his own party leader, then taoiseach John Bruton, "by intimating that government should have no discretion in the matter".

According to the report, the tribunal's remit did not extend to determining if the result of the licence award was correct, but was to "determine whether that decision, on that date [October 25th, 1995], was influenced or impacted on by Mr Lowry," and an examination of the process used to decide on the licence application.

The newly published report says Mr Lowry displayed "an appreciable interest" in the licence competition, had "irregular interactions with interested parties at its most sensitive stages, sought and received substantive information on emerging trends (and) made his preference as between the leading candidates known".

It adds the former minister "ultimately brought a guillotine down" on the work of a project group overseeing the competition, and "proceeded to bypass consideration by his Cabinet colleagues". This, the tribunal concludes, “thereby not only influenced, but delivered, the result", when Esat secured a mobile phone licence.

The decision was made on October 25th, 1995, and announced on May 16th, 1996.

In a statement, Mr Lowry described the Moriarty report as "factually wrong and deliberately misleading".

He said Mr Justice Moriarty "has outrageously abused the tribunal’s ability to form opinions which are not substantiated by evidence or fact".

The report says a payment of IR147,000 made by Mr O'Brien - through David Austin, an associate of both men, via a series of offshore accounts - to Mr Lowry's Isle of Man Irish Nationwide account was "moved from Mr O’Brien’s account to Mr Lowry’s account in the Isle of Man" in a markedly clandestine and covert manner.

It said the absence of any commercial purpose for this payment and the secretive manner of its disclosure meant the tribunal had concluded the payment was made to Mr Lowry, via third parties, by Mr O'Brien “during a period when Mr Lowry held public office, in circumstances giving rise to a reasonable inference that the motive for making the payment was connected with the public office of minister”.

Mr O’Brien responded to the report by saying its findings were "fundamentally flawed" and said it was "incumbent on the judiciary to investigate the conduct of Mr Justice Moriarty and the tribunal legal team for the manner in which they conducted themselves" during the inquiry.

He said there was no evidence that showed he or his company won the licence unfairly or made any payments to Mr Lowry. He said he had never given Mr Lowry "one red cent".

Mr O'Brien said Mr Justice Moriarty was "totally wrong" and had a view that he was guilty. He said he gave the judge access to accounts and diaries and that nothing had been uncovered but that Mr Justice Moriarty had eliminated evidence that did not suit him.

When asked why appeals taken against the tribunal had been unsuccessful, Mr O'Brien said a "ring of steel" had been built around Mr Justice Moriarty.

The tribunal also makes a number of findings in relation to a political donation to Fine Gael of $50,000, to be paid by Esat, "in the immediate aftermath of the successful outcome of the GSM competition".

It said this payment was "made in a manner which, having regard to its false and misleading documentation, the initial payment to an offshore Jersey account, and the eventual delays and misrepresented form of transmission to Fine Gael, was secretive, utterly lacking in transparency and designed to conceal the fact of such payment by or on behalf of the donors".

“The tribunal has found that the payment, although not one ever intended for Mr Lowry personally, was nonetheless one that technically falls within its terms of reference and was a payment to Fine Gael, on behalf of Esat Digifone at the instigation and promotion of Denis O’Brien.”

Fianna Fáil Micheál Martin leader told the Dáil the tribunal had made a “stinging criticism of Fine Gael” and its handling of the issues dealt with by the report.

Taoiseach Enda Kenny rejected this assertion and told deputies his party had been commended by the tribunal for its forthrightness. The report raises “issues that need to be taken serious note of and acted on and they will”.

The tribunal began its inquiry into the licence competition in 2002 after it discovered potential financial links between the former minister for communications Mr Lowry and Mr O’Brien.

The report says the first steps to make an payment to Mr Lowry were taken less than seven weeks after the licence was granted and was made out of the first series of funds made available to Mr O’Brien after he completed a placement on the US market.

The tribunal of inquiry was established in 1997 to look into the financial affairs of former taoiseach Charles Haughey and Independent TD for Tipperary Mr Lowry.

It issued its first report in 2006 - which covered matters to do with Mr Haughey. Its second and final report concerns Mr Lowry, who was minister for communications when the second mobile phone licence was issued to Denis O'Brien's Digifone in the mid-1990s.

The tribunal issued confidential preliminary findings relating to its second report to interested parties in November 2008 but then held subsequent hearings where new evidence was heard that called into question some of the findings.

In the Dáil today, Minister for Communications Pat Rabbitte defended the rainbow coalition government in place at the time of the licence compeititon.

He said none of the other ministers in cabinet had any knowledge about the process of awarding the licence, other than that it was a “best practice process” which was “hermetically sealed”.

The inquiry is reported to have cost in the region of €100 million to €150 million.