ANALYSIS:Under Irish electoral law, bodies such as Libertas can only receive loans if they are bona fide loans, writes COLM KEENA
THE SUSPICIONS that existed during the Lisbon Treaty referendum campaign about the source of the money that was available to the anti-treaty group Libertas have now been shown to have been justified.
Libertas was set up by businessman Declan Ganley and he is its public face. When he was queried during the referendum campaign as to the source of its funding, he said it was receiving donations from ordinary Irish people and complying with Irish electoral law. He declined to answer when asked if Libertas had access to loans.
It now appears that a substantial amount of the funding for the Libertas campaign came from Ganley himself.
He has said he put in place a loan facility for Libertas, and Libertas has, to date, drawn down €200,000. He has also said that others have given loans, but will not say who has given these other loans, or how much they are for.
Libertas is an Irish limited company without share capital. Its abridged accounts for 2007 filed with the Companies Registration Office show no income or expenditure during that year.
Its accounts were audited by Michael Cuddy Co, of Athlone, Co Westmeath. When Cuddy was asked by The Irish Timessome months ago how the accounts could be as they are, given public indications of expenditure by Libertas during 2007, he said he could not respond without the consent of his client.
The public indications of expenditure during 2007 are as follows: a statement after the referendum by former Libertas spokesman John McGuirk, that a room was hired in the Davenport Hotel in August to discuss strategy; a press conference held in a hired room in the Merrion Hotel, Dublin, in December 2007; the fact that Ganley and the second, lesser public face of Libertas, Naoise Nunn, held a photocall outside the Merrion where they posed in front of a large Libertas billboard mounted on the back of a truck; and the fact that during December McGuirk was working for a PR firm, Bracken PR, which had in turn been hired by Libertas.
When asked during the campaign how all this was funded when the accounts stated there was no income or expenditure during 2007, McGuirk said: "Directors' loans." When asked why this wasn't reflected in the Libertas accounts, McGuirk said none of the expenditure he was referring to had occurred during 2007. He then refused to confirm that there had been loans from directors, but instead said Libertas was, since January 1st, 2008, receiving donations.
When Ganley, after the campaign, was asked how these activities in 2007 were funded, he said: "I don't know." He said it was not the case that other directors' loans existed besides his own.
The two issues - the loans from Ganley and others, and the 2007 accounts - are interlinked.
Overall, of course, there is the question of credibility but there is also the issue that on the basis of the accounts, it appears that at least one substantial loan was given to a body in early 2008 that up to the end of 2007 last year had no money at all.
Under Irish electoral law, bodies such as Libertas can only receive loans if they are bona fide loans, with terms and conditions and interest rates equivalent to that available in the market generally.
The law has to be like this as otherwise it would make a nonsense of the State's efforts to legislate for and set limits on political fundraising. Irish law is designed to restrict contributions to "third party" groups such as Libertas to annual donations of not more than €5,348 per donor.
Donors must be Irish citizens or incorporated bodies that direct their affairs from Ireland. The law, obviously, is designed to limit the influence people of substantial means can have, simply by reason of their wealth, on Irish political life.
It also aims to prevent interference from outside the State by bodies or persons who are pursuing their own commercial interests or the interests of foreign states, by way of influencing Irish political decision-making. Most democracies have similar laws.
Irish law defines donations as including donations of material or services used as part of a political campaign. During the referendum campaign Libertas distributed 35,000 copies of a book on the Lisbon Treaty published by Brussels-based group EU Democrats. The book sells for €20, so the books distributed have a nominal value of €700,000.
Ganley rarely took part in a photoshoot during the campaign without having a copy of the book in his hands, yet when asked if the use of this material was not against the law, he denied that the book was part of the Libertas campaign. He said Libertas was simply distributing the book on behalf of its publishers.
Ganley's main business interest at present is a US company called Rivada Networks which, in partnership with an Alaskan enterprise, the Nana Corporation, has multi-million dollar contracts with the US military and the US Federal Emergency Management Agency.
The contracts are for the supply of communications services and it is understood that much of the work is sub-contracted downwards. Rivada has an Irish subsidiary based at Ganley's home in Tuam, Co Galway.
Libertas was incorporated in October 2006. Seven people signed the document establishing the company, five of whom were Rivada employees. Libertas uses the same address and telephone number as Rivada, in Tuam.
During the referendum campaign Nunn, the then "executive director" of Libertas, told The Irish Times that he was an employee of Rivada since October 2006 and still was. He said Ganley would assign him to his duties and that his main activity was working for Libertas.
He also said the Libertas campaign director, David Cochrane, was an employee of Rivada who had started working for Rivada in 2007, and worked mainly on developing the Libertas website. Nunn said he received his instructions from Ganley.
Ganley subsequently said the two executives were wrong, and that the Libertas work they did was done in their spare time, on a voluntary basis. Nunn is no longer with Libertas and when contacted did not want to add or subtract from his earlier comments.
If Nunn and Cochrane were employed by Rivada and providing services to Libertas in 2007, this would seem to breach Irish law in relation to foreign donations and the limits allowed for an individual donation to a body involved in political campaigning. It would also raise questions in relation to the audited Libertas accounts for 2007.
Ganley has said the total Libertas spend during the referendum was approximately €800,000, a larger sum than any other body involved in the campaign. Others believe the spend exceeded €1 million. The former Libertas spokesman, McGuirk, has indicated a spend of €1.3 million. Libertas continues to fundraise through its website.
The Standards in Public Office Commission (Sipo) has responsibility for policing the law on political fundraising. It is believed to be investigating the sourcing of the money used by Libertas in the referendum. Neither it nor Ganley will comment. Everything that is known about Ganley would indicate that he and Libertas will robustly defend any intrusion perceived as unjustified.
The law gives Sipo the power to demand the production of documents in the course of its inquiries, so on paper it would seem to have the capacity to properly investigate what is a confused and troubling scenario, involving as it does possible breaches of the law on political fundraising by a body that had a decisive role in a referendum that has upended Irish foreign policy, and greatly disrupted Europe.
The scale of the upset was evident last week when the leaders of the political groups in the European Parliament decided to approach the US Congress in relation to suspicions that Libertas may have received support from those in the US who perceive the Lisbon Treaty as being contrary to US interests. They also decided to initiate contact with Sipo.
So Sipo is truly in the limelight.
• Colm Keena is Public Affairs Correspondent of The Irish Times