New bureau could be an asset to tribunals

BUSINESS OPINION/Colm Keena: The announcement that the Government intends to create a Corruption Assets Bureau to pursue assets gained by the corruption of politicians or public officials, changes significantly the context in which the Dublin Castle tribunals are taking place.

At present two tribunals are taking place in the castle which are involved in investigating whether payments were made for public favours. Those dragged before these tribunals know that while the tribunal lawyers get on with the job set out in their terms of reference, the venerable chairmen are not the only ones listening to their every word.

Revenue officials tend to be represented in the public seating at both tribunals, men and women who sit listening to the evidence and who occasionally scribble something in a notebook. Listening to the evidence it is hard not to imagine you have heard the ringing of cash registers whenever some unfortunate's private banking details are disclosed, or even put up on an overhead projector. When the cash registers ring the Revenue officials scribble.

After each day's sitting the officials have a short walk to their offices where they report to their superiors. Some days they have little to report. Other days they can report developments which will obviously lead to million-euro plus settlements in relatively short time. From the Revenue's perspective, this is easy money. It is a pity for the officials they are not on commission.

The Flood Tribunal in the Print Hall has to date been far more productive than its twin in George's Hall, the Moriarty Tribunal. Bovale Developments, the company run by brothers Michael and Tom Bailey, has already paid about €10 million to the Revenue as a result of the Flood Tribunal's inquiries into its dealings with the disgraced former Fianna Fáil minister, Mr Ray Burke. And that may be just for starters.

The dreaded approach from the taxman has arguably been the greatest penalty anyone or any company has had to fear so far from a tribunal inquiry into their affairs. Public cynicism about the possibility of anyone ever going to jail has so far proved well founded, though the indications are that the Revenue intends trying to prosecute the former Fine Gael Minister, Mr Michael Lowry. (That sentence could have been written at any time since August 1997.)

The prospect of a Corruption Assets Bureau changes the ballgame. From now on persons or companies with something to hide have good reason for a whole new class of fears. If matters go horribly wrong in the tribunal chamber, then something close to their idea of penury might be in prospect for some.

Persons or institutions having dealings with substantial individuals or companies under the tribunals' gaze, may be already reviewing their attitude. How safe now are this invidivual's/company's assets, a bank manager could conceivably ask, pausing over a loan application for €50 million.

Work is under way on the legislation to set up the bureau and the broad outline of what is envisaged has been published. The new law will allow a garda not below the rank of a chief superintendent to act on the conclusion of a tribunal that a person received a corrupt payment or received a benefit as a result of a corrupt payment. The officer can go to the High Court and seek a freezing order regarding the assets stated to have been corruptly obtained. This will include assets whose value has been found to have been corruptly enhanced. An example would be a plot of land given a more attractive zoning.

The new law may allow the High Court appoint inspectors to the affairs of an individual or company. This inspector's task would be to trace the history of particular assets and to report back as to the current value of assets obtained through the use of corruptly acquired assets. So if you corruptly acquired planning permission or a licence for a particular commercial activity, and subsequently used that asset to create significant profits, those profits (or the assets bought with them) could be seized.

This is the sort of legislation which might bring sweat to the brow of a successful businessman with some old secret to hide. The simplicity or otherwise of the calculation would of course depend on the circumstances. If you were given a radio licence as a result of a corrupt payment, then the station and its profits might be seized. But if you had a minister cap RTE's advertising revenue, how would someone decide exactly how much money flowed to the private station as a result of that, and the profits which thereby arose? Honours maths would be required there.

Assets acquired long ago will be treated according to their current value. If a corrupt government minister bought a house with £1,000 he was given in 1960, the Corruption Assets Bureau will want the equivalent of the present day value of the house, from the outed minister.

According to Government whip Ms Mary Hanafin, the new legislation will give the bureau the power to act on reports issued by tribunals before, as well as following, the enactment of the new law. Assets seized by the bureau will be held for the benefit of the Irish people, according to Ms Hanafin.

Given what is involved and the importance given to the right to property in this State, the legislation will have to be cleverly drafted to survive High Court and Supreme Court challenges, both of which are almost inevitable. The proposed law is likely to make cash registers ring in the Four Courts.

Businessmen entering the witness box over the coming months and years will do so with the knowledge that the tribunal's deliberations could see them stripped of the achievements of a lifetime. It is not the case that only those with something to hide have anything to worry about. There can be a fine line between political contributions and corrupt payments; politicians and business people live in the same small Republic and at times work closely together; and judges can get it wrong. Showtime indeed.