Ahern had Burke investigated over passports for Arab banker

The Taoiseach, Mr Ahern, has investigated Mr Ray Burke on three occasions - including once since he appointed him Minister for…

The Taoiseach, Mr Ahern, has investigated Mr Ray Burke on three occasions - including once since he appointed him Minister for Foreign Affairs - about the circumstances in which he granted 11 passports to a wealthy Arab banker in return for a promised investment of £20 million.

Mr Ahern moved to satisfy himself about Mr Burke's involvement in the passports case shortly before he named his Cabinet last June and again shortly after he had appointed him Minister, senior Government sources have confirmed.

On both occasions the inquiries, designed to assess Mr Burkes's fitness for office, were made through senion civil servants.

Mr Ahern also reviewed Mr Burke's involvement in the affair in November 1994 at a time when he appeared poised to be appointed Taoiseach.

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This followed discussions with the then minister for justice, Mrs Maire Geoghegan-Quinn, who expressed her "very serious concerns" about the manner in which the passports were issued and ordered an internal Department inquiry.

The inquiry, the results of which were furnished to the former minister for justice, Mrs Nora Owen, in January 1995, found that statutory procedures for the naturalisation of foreigners had been breached in several cases.

Sources suggested last night that Mr Burke had been asked to grant the passport applications by the former Taoiseach, Mr Charles Haughey, although this has not been confirmed.

Some in Government take the view that Mr Burke had been "effectively cleared", as Mrs Owen did not direct any action against Mr Burke on receiving a Department of Justice report. On the matter

Government sources expect, however, that the passports-for-investment scheme will now have to be drawn within the terms of reference of the Moriarty tribunal, which will examine Mr Haughey's financial affairs.

Should this happen, Mr Burke faces the prospect of being examined by two tribunals - the Moriarty inquiry and the proposed tribunal into planning in north Co Dublin and the donation of £30,000 to Mr Burke by a builder.

The recipients of the passports were Sheikh Khalid bin Mahfouz and his family and friends. In an unusual procedure, Mr Burke personally authorised the naturalisation certificates at his home in Swords, Co Dublin, late on Saturday, December 8th, 1990 - instead of delegating the matter to a senior official as was standard practice.

The following day, the passports were handed to Sheikh Khalid, head of Saudi Arabia's only private bank, National Commercial Bank, and one of the kingdom's wealthiest persons, by Mr Haughey at a lunch in the Shelbourne Hotel, Dublin.

In return, Sheikh Khalid gave a letter to accountants Haughey Boland, promising £20 million worth of investments in various employment projects.

But the internal Department of Justice report, completed in January 1995, was able to account through the IDA for only £3 million of the promised investment.

The investments are still being monitored in the Department of Justice. About £17 million in investments has now been made. Some £3 million has still to be traced.

The internal inquiry conducted by Mr Dermot Cole, an assistant secretary, found that statutory procedures were breached in several cases, including:

Passports were obtained by the 11 before the necessary naturalisation procedures were completed;

Fees were not paid in advance of the issue of the passports, as required;

The applicants did not meet the customary residential requirements which would normally oblige them to have spent about 60 days in the jurisdiction;

The requirement that applicants should swear an oath of fidelity to the State was waived - a highly unusual but perfectly legal procedure.