The obstruction of investigation into the Ansbacher accounts is likely to become a contentious political issue here soon, so let it be clear where the parties stood on the matter when it mattered, on Thursday, September 11th, 1997.
First, let us recall what these Ansbacher accounts were. They were deposits by Irish residents in a bank in the Cayman Islands, Ansbacher Cayman Ltd. The deposits were then amalgamated and transferred in bulk to the Guinness & Mahon Bank in Dame Street, Dublin. Nobody, other than the person who set up the scheme, the late Desmond Traynor, later his successor, in the Dublin bank, Padraigh Collery, and a few officials in Cayman Islands knew who the owners of the deposits were. By 1990 they amounted to £38 million. This was an extraordinary arrangement and caused concern at the parent bank, Guinness Mahon (London). A review of these arrangements by the auditors, Coopers and Lybrand, in 1987 stated: "The customers are generally undisclosed except to the most senior manager of the company . . . The principals will not sign any documentation . . . The principals do not receive statements on account on a regular basis . . . Instructions are usually received by telex from solicitors or other trustees by telephone from the principal . . . There is never any direct written instruction from the principal."
The auditors concluded: "In view of the above there is a high risk of mismanagement or fraud, and it is essential that strong controls are in place."
The McCracken tribunal report said: "This was a very ingenious system whereby Irish depositors could have their money offshore, with no record of their deposits in Ireland, and yet obtain an interest rate which was only one-eighth of 1 per cent less than they would have obtained had they deposited it themselves in an Irish bank."
It went on to speculate that a number of these depositors were people engaged in international business which was facilitated by having a sterling account abroad. Of course, a sterling account held abroad could have facilitated international business transactions, but, in this instance, the monies were diverted back into Ireland and the sole ostensible purpose of the exercise can only have been to hide the money from the tax-man.
Anyway, if some of the deposits were as innocent as the report seems to allow, why would it have been necessary to involve them in banking practices that were so disapproved of by the parent bank? Why all the secrecy about the operation of the accounts if they were innocent?
The prima facie evidence is that these deposits were, at the very least, questionable.
FACED with this evidence what did our legislators do? Obviously one of the prime objectives of a new tribunal would be a further investigation into the finances of Charles Haughey and Michael Lowry but, given what had been revealed about the accounts, one would have expected that a new inquiry would cover these as well.
In the event, the following is what was done.
It was the leader of the Progressive Democrats, Mary Harney, who proposed the substantive resolution to the Dail on Thursday, September 11th, 1997, on the institution of an inquiry into these matters.
The parts of the resolution relevant to the Ansbacher accounts were clauses (b) and (c). Clause (b) provided for an inquiry into "the source of any money held in the Ansbacher accounts for the benefit or in the name of Mr Charles Haughey or any other person who holds or has held ministerial office, or in any other bank accounts discovered by the tribunal to be for the benefit or in the name of Mr Haughey . . ."
Clause (c) provided for an inquiry into "whether any payment was made from money held in any of the [Ansbacher] accounts . . . to any person who holds or has held public office during the period or his/her tenure".
It provided for no general inquiry into the accounts. Fianna Fail and the PDs, supported by thr Independent TDs, Mildred Fox, Harry Blaney and Jackie Healy Rae, voted to restrict the inquiry to just these matters. Fine Gael was prepared to go a little further. Its finance spokesman, Michael Noonan, proposed that the tribunal investigate the accounts to identify the procedures used in these transactions; to report whether such a system was used to evade tax and breach exchange controls; and to recommend how such devices could be prevented from further tax avoidance.
And that was it. For Fine Gael, too, there was to be no general inquiry into the accounts. The new tribunal should inquire only into those accounts connected with Mr Haughey and other politicians and then should engage in the timid exercise of further examining the procedures used (the McCracken tribunal had already done that), inquire whether it was a tax scam (big deal, since we already know that it was) and make recommendations etc. The real crunch of the issue was to be avoided: the exposing of those involved. Fine Gael joined Fianna Fail and the PDs in refusing to support the following proposals:
To inquire into "the source of any money held in the Ansbacher accounts" (proposed by Fine Gael's former coalition partner, the Labour Party).
"To establish the source and beneficial ownership of all monies held in the Ansbacher accounts . . . and to further establish in relation to these accounts those operated to facilitate normal international business or those held from other motives" (proposed by Fine Gael's other former coalition party, Democratic Left).
"To inquire into the Ansbacher accounts and to establish who were the beneficial owners of the monies in these accounts and the motive for lodging monies in those accounts" (proposed by Joe Higgins of the Socialist Party).
"To inquire into the background to the Ansbacher accounts to establish the identity of the owners of the monies held in the accounts and the reason the monies held in the Ansbacher accounts remained outside the supervision of the Revenue Commissioners and the banks' regulatory authorities" (proposed by John Gormley of the Green Party).
The terms of reference of the Moriarty tribunal are also deficient in a number of other respects. First, they allow for an inquiry into Mr Haughey's finances only back to 1979, the year in which he became Taoiseach. For instance, Mr Haughey was able to buy a 135-acre stud farm at Ratoath, Co Meath, in 1968 without any recourse to borrowings. A crucial question arises: how was he able to finance that purchase at a time when his total known income was £5,000 per year?
They also fail to include any inquiry into the Central Bank's role in relation to the accounts. The Ansbacher Cayman deposits in Guinness Mahon comprised 30 per cent of its total assets. This was in clear breach of the Central Bank's guidelines, which require that such deposits form no more than 5 per cent of total deposits. How did the Central Bank miss this year after year?