Documents may alter Moriarty findings on Lowry property ventures

ANALYSIS:The tribunal is examining letters that appear to conflict with earlier evidence

EIGHT YEARS after it began its inquiries into Michael Lowry’s property ventures in England, the Moriarty tribunal was this week given documentation that may alter its findings on the matter.

The documents were given to the tribunal on Monday afternoon by English solicitor Christopher Vaughan. He said he had been given them three to four weeks earlier by Northern Ireland land agent Kevin Phelan. Much of the documentation consists of correspondence between the two.

Vaughan acted in the purchase of property in Mansfield and Cheadle in the late 1990s. In 2001 he said he had given his files on the deals to the tribunal. Phelan acted as land scout for the two deals, but has declined requests to appear at the tribunal.

In the period between receiving the documents and forwarding them to the tribunal, Vaughan’s solicitor inquired of the tribunal if it had received documents from Phelan. Vaughan yesterday said the delay in giving the documents to the tribunal arose from the fact that he had to wait for an opportunity to meet his counsel.

A key issue is this: the tribunal has been told that by the time the Cheadle property was purchased, the deal had passed from Lowry to accountant Aidan Phelan, because Lowry had not been able to come up with the money to close the deal. Vaughan says he was holding the property in trust for Phelan.

However, the letters produced this week, many of which come from 2000 when it seemed the Cheadle property might be sold for a profit of £600,000, indicate that Lowry was the person who stood to profit from the deal. Questioned about this, Vaughan stood by his earlier evidence, and that of Lowry and Aidan Phelan, that the deal had passed on from Lowry to Phelan by 2000.

A letter dated August 9th, 2000, from Vaughan to Kevin Phelan, appears to review the evidence that existed in relation to the ownership of both properties. In relation to Mansfield, it noted that Vaughan’s client account bank statement did not record the source of the funds used to close the deal. They had come from Aidan Phelan. In relation to the Cheadle deal, the letter said the property was registered in Vaughan’s name as trustee for an unnamed beneficiary but that banking documentation showed a reference to Catclause Ltd, of which Lowry was a director.

Vaughan yesterday opposed suggestions from tribunal counsel Jerry Healy SC that the letter exhibited a concern to hide Lowry’s involvement. He said the letter answered questions that must have been put to him by Kevin Phelan, and that the letter could have been used by Phelan to show to potential purchasers.

The reason the deals are of interest to the tribunal is that the bulk of the money for the Mansfield deal came from Aidan Phelan, who sourced it from an account holding money belonging to Denis O’Brien, for whom he worked at the time. The bulk of the funding for the Cheadle deal came from Investec Bank in a loan arranged by Aidan Phelan. At one stage the bank was told O’Brien stood behind the loan.

In one of the letters, Vaughan wrote saying “Aidan needs to keep the mortgage lender happy as to the loan that Michael took out.” Vaughan said this was a mistake on his part, and the loan had been taken out by Phelan, not Lowry.

Vaughan is secretary of the English Notaries Society. Mr Justice Michael Moriarty expressed concern about his objectivity.