Political payments treated as fees for consultancy

Mahon tribunal: A former financial director of Monarch Properties has said he is unable to explain how political payments came to be treated as consultancy fees in the company's books.

Dominic Glennane agreed the payments were wrongly described in the books, but said he didn't know why this had happened. Their description as "strategic consultancy fees" may have been a convenient heading, he suggested.

He said Monarch made payments only when asked by politicians to contribute. He denied the company tried to hide a number of payments to the lobbyist Frank Dunlop, or that it gave Mr Dunlop money for distribution to councillors.

The tribunal is investigating an allegation by Mr Dunlop that he bribed two councillors to secure the rezoning of Monarch's land in south Dublin. Separately, the company has told the tribunal it made payments totalling over £500,000 in connection with the rezoning; almost half of this sum was spent on contributions to 69 politicians.

Patricia Dillon SC, for the tribunal, pointed out that the company had given the lobbyist a VAT-exempt cheque for £15,000 in November 1993. This was the only payment to Mr Dunlop for which there was no liability for VAT. The money was paid just days before a crucial council meeting at which the Cherrywood rezoning was debated, she pointed out.

Mr Glennane rejected Ms Dillon's suggestion that Monarch was complicit in issuing a VAT-free cheque that could be used as cash. He said it was totally untrue to suggest Monarch had tried to give money to Mr Dunlop in an underhand way for distribution to councillors.

Ms Dillon asked why Monarch had got it "so terribly wrong" when it first listed the payments to Mr Dunlop. While it had initially claimed to have paid the lobbyist £52,000, the actual figure was £85,000. Mr Glennane said he didn't have any detailed knowledge of the work Mr Dunlop was carrying out on behalf of Monarch.