The McCracken Report (particularly pages 37-40), extracts from which are outlined earlier, describes the operation of the Ansbacher Deposits. The Eleventh and Twelfth Schedules to the Report which contain extracts from Audit Reports conducted in 1987 and 1989 deal with a number of matters in greater detail.
In his Report, the Authorised Officer reveals in detail that the Company provided private offshore banking and trust services in Ireland from the early 1970s up to recent times. Such services included:
(a) The formation and management of a substantial number of discretionary trusts and companies in the Cayman Islands for the benefit of Irish residents;
(b) The operation of a secret ledger ("memorandum accounts") in Dublin, which represented monies held by the Company for the benefit of Irish persons;
(c) The operation of accounts in GMI and IIB in the name of the Company, which were used to make payments to or for the benefit of Irish persons when they so desired;
(d) The acceptance of deposits from, or for the benefit of, Irish residents. In this regard, the Company operated:
(i) an offshore lodgement system, and
(ii) a lodgement system via accounts in domestic Irish banks in the names of Amiens Securities Ltd and KSL, which systems appear to have been designed so as to conceal lodgements by Irish individuals to accounts in the Company;
(e) The negotiation with Irish banks of back-to-back loans for Irish individuals and companies which were secured on cash deposits provided by the Company. Its Chairman and certain of its directors requested certain Irish banks to omit the primary security of the cash deposit from facility letters relating to such loans;
(f) The conducting of unlicensed banking business in Ireland.
The Authorised Officer has expressed the view in his Report that the essence of the arrangement was that Irish resident individuals could secretly place their funds offshore and ostensibly outside of their control while, in reality, retaining access to them and control over them. In particular, such individuals, often through their Irish corporate vehicles, could, with the complicity of certain Irish banks, borrow what was in substance (though not in law) their own money. These individuals could then obtain the benefit of tax relief in Ireland on the interest arising on those borrowings, while ensuring that the Irish Revenue Commissioners were kept in ignorance of the existence of the funds.
