Haughey payments 'devalued' democracy


The Moriarty tribunal has published a scathing report into the finances of the late Charles Haughey in which it finds he accepted cash for favours from wealthy businessmen over 17 years and devalued the quality of the State's democracy.

Among the key findings in Mr Justice Michael Moriarty's report was the fact that Mr Haughey spent a significant portion of the money raised for a liver transplant operation for his former colleague Brian Lenihan.

The tribunal is satisfied that a sizeable proportion of the excess funds collected was misappropriated by Mr Haughey for his personal use
Moriarty report

The tribunal said it was satisfied that "Mr Haughey alone knew what was collected for the benefit of Mr Lenihan, and by whom it was contributed". It says that "as much as £265,000 may have been collected for that purpose, and that of those funds, no more than £70,283.06 was applied in meeting the costs and expenses attendant on Mr Lenihan's medical treatment in the United States.

"The tribunal is satisfied that a sizeable proportion of the excess funds collected was misappropriated by Mr Haughey for his personal use," the report says.

The 700-page report, published after nine years of hearings, also found that Mr Haughey had been paid IR£50,000 (€63,000) by Saudi sheikh Mahomoud Fustok to support passport applications in the early 1980s.

The late taoiseach claimed the money was payment for a horse, but the inquiry found it was made in a secretive and clandestine manner and was connected to the naturalisation of a number of Mr Fustok's relatives.

"The Tribunal is satisfied that, while Mr Fustok may well have purchased a horse from Abbeville Stud, the payment of £50,000 in February, 1985, which was made in a secretive and clandestine manner, by being channelled through Dr [John] O'Connell's bank account, did not relate to that or to any other commercial transaction, but constituted a payment by Mr Fustok to Mr Haughey . . . and was specifically connected with the naturalisation of certain of Mr Fustok's relatives."

It found that this and other payments the late taoiseach received between 1979 and 1996 funded Mr Haughey's conspicuously lavish lifestyle beyond what his relatively modest salary should have afforded him.

The former taoiseach's dealings with businessmen between 1979 and 1996 were unethical, the tribunal concluded.

"Apart from the almost invariably secretive nature of payments from senior members of the business community, their very incidence and scale, particularly during difficult economic times nationally, and when governments led by Mr Haughey were championing austerity, can only be said to have devalued the quality of a modern democracy", the tribunal says.

In connection with the management of Mr Haughey's finances, the report is critical of Allied Irish Bank where Haughey held an account throughout the 1970s.When Mr Haughey was elected taoiseach in 1979 he owed the bank £1.143 million, a debt that related solely to personal and household expenditures made by Mr Haughey during those years

The report says AIB "took no action whatsoever to curb Mr. Haughey's mounting indebtedness, or to recover the debt which he owed. On the contrary, the Bank exhibited a marked deference in its attitude to Mr Haughey, and a disinclination to address or control his excesses as a banking customer which had accumulated over several years, and which became increasingly pronounced when he was appointed a Government Minister in 1977.

"The tribunal is of the opinion that the degree of forbearance shown by Allied Irish Banks in the settlement concluded with Mr Haughey in January, 1980, constituted an indirect payment, or benefit equivalent to a payment."

The Leader's Allowance Account, set up to receive the Party Leader's Allowance from the Exchequer was used by Mr Haughey to make payments that were of personal benefit, the report says.

For all practical purposes, the account was treated by Mr Haughey as being at his disposal
Moriarty tribunal report

"For all practical purposes, the account was treated by Mr Haughey as being at his disposal, and Mr Haughey accepted that it was used for payments not intended to be made from the Leader's Allowance, including payments to meet his personal expenditures," the report said.

The report added that although Taoiseach Bertie Ahern, who co-signed the cheques drawn on the account at the time, facilitated the misuse of the account, he had "had no reason to believe that the account was operated otherwise than for a proper purpose".

In his evidence to the tribunal, Mr Haughey insisted he was unable to help the tribunal with identifying donors. He said his finances were handled by the late Des Traynor since the 1960s and, for this reason, the details were not known to him.

The Moriarty (Payments to Politicians) Tribunal was established in 1997 in the wake of the McCracken (Dunnes Payments) Tribunal, which revealed that Mr Haughey had received huge payments from Ben Dunne.

Mr Ahern's office said in a statement this evening the Government had introduced significant reforms and safeguards to prevent political corruption since the tribunal began its work.

"While there have been significant measures of reform and safeguards introduced as the Tribunal work was in progress, the Taoiseach indicated that the Government would consider the report very carefully over the coming weeks to identify any further initiatives which might be required," it added.

Tánaiste and Minister for Justice Michael McDowell said the Moriarty report provides a significant opportunity to learn lessons from the past. "It reminds us why the highest ethical standards must be explicitly stated and adhered to in any democracy," the Progressive Democrats leader said.