The tangled tale of a strange loan linked to Lowry

Two more witnesses, it now seems, will tell the tribunal a £420,000 sterling loan taken out from GE Capital Woodchester in December…

Two more witnesses, it now seems, will tell the tribunal a £420,000 sterling loan taken out from GE Capital Woodchester in December 1999 was for Mr Michael Lowry.

On Thursday a Cork property developer, Mr John Daly, said he agreed during a brief conversation with Mr Lowry in late 1999 he would guarantee the loan. The money was to provide finance for a Manchester property deal.

The tribunal has been told Mr Aidan Phelan, a close business associate of Mr Denis O'Brien, was asked by Mr Lowry to help him get a loan in September 1999.

Mr Phelan broached the subject with Mr Michael Tunney, a senior executive with Woodchester. Mr Phelan is to tell the tribunal he said the loan was for Mr Lowry. Yesterday Mr Tunney said Mr Phelan told him he, Mr Phelan, was buying the Manchester property. He offered Mr Daly as guarantor. Mr Phelan is to tell the tribunal Mr Tunney asked for added security, and this led to the guarantee.

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Mr Lowry, according to his counsel, will say he was contacted by Mr Tunney, at the time the loan was going through, about Mr Daly. He will say he gave Mr Tunney Mr Daly's phone number. Mr Tunney, however, says he got Mr Daly's number from Mr Phelan and that at no stage during his conversation with Mr Daly was Mr Lowry's name mentioned.

He accepted that when he raised the loan application with his then boss, Mr Michael Cullen, he may have mentioned Mr O'Brien's name, even though he believed Mr O'Brien had nothing whatever to do with the deal. This would have assisted the loan go through. Mr Tunney insisted yesterday that this did not mean he had misled Mr Cullen. Everyone at all times believed this was a transaction of Mr Phelan's, he said.

A second bank executive, Mr Anthony Morland, has also said Mr Tunney told him in December 1999 that the loan was a transaction involving Mr O'Brien.

According to Mr Daly he changed his mind over the Christmas period of 1999 and decided not to go guarantor for Mr Lowry. Mr Phelan is to tell the tribunal that after Mr Lowry failed to come up with a replacement he, Mr Phelan, took over ownership of the property which had been bought with the loan. He also took over responsibility for the loan.

Earlier this year the bank found out there was a link between the loan and Mr Lowry. During a few key conversations, Mr Tunney repeated that Mr O'Brien was behind Mr Phelan. At one stage he said that this was what Mr Phelan had told him. He said yesterday that he felt at all times that if anything did go wrong, Mr O'Brien, because of his general relationship with Mr Phelan, would set matters right.

More evidence is to be heard next week. Mr Christopher Vaughan, an English solicitor who acted for Mr O'Brien and Mr Phelan in property deals in the UK, has not as yet responded to requests to give evidence.