THE west Dublin gang which gardai believe murdered the journalist Veronica Guerin has been reduced from one of the most successful criminal operations in the history of the State to a position of paralysis as a result of Garda activity against it.

The last detected activity by the gang was two months ago when a prominent member, who is living abroad, organised the embezzlement of money from an Irish finance company as part of a car fraud.

Two minor criminals, acting on behalf of the gang member, drove a BMW car from England, paying duty to re-register it in the Republic. They then traded it with a west Dublin car dealer against a much more expensive car and re-sold the new car without paying off the loan. They made at least £15 000 on this fraud and may have made £20,000 in similar frauds.

Ironically, the criminals lost the money. It is believed it was stolen by another associate of the criminal.

There was an attempt by some of the gang members to re-establish their drug distribution network, but this was stopped by Garda action and by the murder last month of the west Dublin drug dealer, P.J. Judge.

Judge, it emerged, had made contact with the remnants of the gang with a view to rebuilding their lucrative business. He was shot dead as a result of a row with another drug dealer in Finglas, Co Dublin.

Gardai investigating the Guerin murder say the failure to re-establish a drug supply network and the relatively minor nature of the car fraud are indicative of the reduced circumstances the gang members now find themselves in.

UNTIL the murder investigation, the gang controlled a multi-million-

pound crime organisation whose core business was the importation and distribution of cannabis. At its peak, the cannabis business involved the weekly delivery of between 60 and 300 kilos of the drug.

The gang virtually monopolised the supply of it in Dublin and also supplied much of the Northern Ireland market. It had reached such a level of stability that the gang was able to return packages of low-grade cannabis to the supplier in Holland.

As evidence of the scale of the gang's cannabis operation, during the past six months the cannabis supply into Ireland has been reduced to the lowest levels known in the past two decades.

The Garda investigation has also provided a clearer picture of the plot to murder Ms Guerin and the activity that surrounded her death. Gardai believe the murder was ordered by the head of the criminal gang, a man who feared Ms Guerin was about to expose his activities.

His associate, the former fraudster who instigated the car finance fraud, is one of the most complex figures in the Dublin criminal underworld. He is a former close associate of Martin Cahill, the criminal shot dead by the IRA in 1994.

He became a source of information for Ms Guerin and probably supplied her with a number of her better-known reports about the Dublin underworld. These probably included Ms Guerin's stories about the convoluted private life of Cahill.

However, it is also believed he intentionally set out to abuse the confidence he established with her, to feed her misinformation about other criminals and particularly, to blacken the reputation of gardai whose investigations posed a threat to the gang.

At the same time, this man had attempted to compromise a small number of gardai by either involving them in semi-legitimate business activities or by befriending them and pretending to be prepared to act as an informant.

In point of fact, he had a reputation of being a genuine Garda informant. A number of Dublin detectives report having had experiences of arresting him for fraud and other offences, only to be directed to release him without charge. The man has been abroad for most of the last six months. At one stage he was running a bar in southern Spain.

Among his associates are two young Dublin criminals, both involved in prostitution and one with a sideline in the car trade, who attempted to pass misinformation to Dublin journalists about the alleged corruption of gardai. These stories were being passed to them by the fraudster.

Investigators believe Ms Guerin inadvertently let this man know she was due to appear before Naas District Court on a speeding charge on June 26th last. She had spoken of her concern about losing her driving licence because of the nature of the offence, and it is believed she may have spoken to the criminal about this.

The murder investigators believe once the gang became aware of this information they set about arranging her murder. As many as a dozen members were involved. Two brothers, members of a criminal family from Ballyfermot, provided the stolen motorcycle used by the assassins and the two or three other vehicles used in the pre-murder surveillance and later escape.

Ms Guerin was watched during the morning of her court appearance, but was briefly lost by the gang after she left the court. This precipitated the high-speed dash by the two gunmen on the motor cycle back along the Naas dual carriageway to the traffic lights at Newlands Cross. There the pillion passenger, a north inner Dublin criminal with a history of violence, alighted and shot Ms Guerin in her car.

The driver of the motorcycle, a man in his early 30s, is a close friend of the gang leader. He has only relatively minor convictions but in the year or two before Ms Guerin's death had begun to lead an ostentatious life style.

The murder was not carried out by hired or contract killers, as was speculated in its immediate aftermath. Both of the assassins on the motorcycle have left Ireland. The actual gunman, who had associations in the 1970s with INLA members, is believed to have spent some time in Northern Ireland and then travelled to England.

There are persistent pointers to involvement of ex-INLA figures in the activities of the gang. It is believed the gang leader befriended several INLA members while serving a sentence in Portlaoise prison and continued the relationship after his release. It is believed he occasionally made contributions to the organisation.

The motorcycle driver was also detected in England but may now have moved to Holland. The leader of the gang is in custody on drugs-related charges abroad. One of the two brothers who supplied and disposed of the stolen motorcycle and cars and who played an active role in the organisation of the murder is also abroad, last seen in England. The other minor players in the murder are mostly still in Dublin.

It is unclear how the investigation will progress from here. The Garda is not thought to have, so far, sought the extradition of any of the main suspects. Under Irish extradition law, suspects brought back on extradition warrants cannot be questioned by gardai.