Three directors settle over offshore payments

THE tax settlement made by directors of Murray Consultants for £1 million related to offshore payments to the three men, Mr Joe Murray, Mr Jim Milton and Mr Terence Horgan, by clients during the 12 years leading up to 1990. It was one of the largest such settlements that has been made public in recent years. The settlement was made through an offshore company.

The three men declined to comment yesterday but sources close to Murray Consultants said that the issue related to the personal tax affairs of the three directors and was not connected with the tax affairs of the company.

Murray Consultants numbers several state agencies and semi state companies amongst its clients and could not carry out work for them if its tax affairs where not in order, according to sources.

The 1992 settlement was made through a Panamanian registered company, Leriona Shipping Line, which paid the Revenue Commissioners £1 million in 1992, according to the Revenue Commissioners 1992 report. The amount of tax underpaid, the size of the penalties paid and the amount of interest owed was not shown. The payment was published under the name of the off shore company.

The offshore payments were for work carried out both in Ireland and abroad for a number of clients. The payments are believed to have came to light after the Revenue Commissioners commenced an investigation in December, 1991.

Murray Consultants is an adviser to many prominent Irish companies and also to Dr Tony O'Reilly. Its clients include many of Dr O'Reilly interests in Ireland, including Independent Newspapers and Fitzwilton. Other companies for which it acts are Murphys Brewery CIE James Crean and Ivernia. The consultancy has a very strong reputation for advising clients on how to handle difficult situations.

Most recently Murray Consultants acted for Aran Energy in its successful defence of a hostile take over from Atlantic Richfield.

Murray Consultants was substantially reorganised in late 1992. More than £700,000 of the company's reserves were redistributed, of which £650,000 was paid into a pension fund primarily for the three directors.

The company's accounts for 1992 show that the amount accumulated in the profit and loss account fell from £374,049 to £117,000. This would reflect pre tax losses in the region of £300,000.

The company's cash balance at the year end fell from £234,389 to £4,376 and it took out an overdraft of £277,774. A loan of £233,000 was raised from a subsidiary company and £232,1351 repaid by another subsidiary which owned the company's office building on Mount Street in Dublin.

As part of the re organisation the business of Murray Consultants was transferred at the end of 1992 to a new company. The old Murray Consultants ceased to trade and changed its name to Nocrumb limited. The major assets, namely the subsidiary which I owns the Mount Street offices remain in Nocrumb.

The restructuring was undertaken in order to realise the value of the three directors stakes in the business as part of the process of admitting new directors, according to Murray Consultants.