The Moriarty tribunal investigating the finances of the former Taoiseach, Mr Charles Haughey, is understood to have discovered payments of £1 million-plus which were passed to Mr Haughey's financial adviser, the late Mr Des Traynor, in the 1970s.

Mr Traynor, who established and operated the Ansbacher deposits and organised the personal finances of Mr Haughey since the early 1960s, is known to have solicited funds for Mr Haughey from significant Irish business figures. It is not clear if the £1 million-plus group of payments were passed to Mr Traynor for this reason or if the tribunal has established the final destination of the money.

The Moriarty tribunal begins to hear evidence in public next Thursday and legal observers say they expect it will start with a splash as it is likely to have accumulated a huge amount of material since it was established in September 1997, and to be anxious to show how much progress has been made.

Mr Haughey has been living a lifestyle which could not be explained by his known income since the early 1960s and among the issues to be revealed over the coming months, is how far back the tribunal has gone in its inquiry into the former Taoiseach's finances.

The High Court, in rejecting Mr Haughey's attempt to have the tribunal declared unconstitutional last year, was critical of the terms of reference the tribunal was given. They contained "undoubted ambiguities", said Mr Justice Geoghegan. The main problem was "how far back" Mr Haughey had to go in co-operating with the tribunal.

The terms of reference charge the tribunal to inquire into "substantial payments" made to Mr Haughey between January 1st 1979 and December 31st, 1996, "in circumstances giving rise to a reasonable inference that the motive for making the payment was connected with any public office held by him or had the potential to influence the discharge of such office".

However, the terms also charge it to inquire into the source of any money held in the Ansbacher deposits for Mr Haughey, or transferred from the deposits to Mr Haughey. Mr Justice Geoghegan said the Ansbacher deposits apparently date back to the mid-1970s.

The tribunal is also charged to inquire into whether "Mr Charles Haughey did any act or made any decision in the course of his ministerial duties, to confer any benefit on any person making a payment" to him. Mr Haughey was appointed to his first cabinet post in 1961, but it is not clear if the tribunal believes it can make inquiries that far back.

Legal sources say the tribunal can inquire into matters which precede dates contained in its terms of reference if it needs to do so in order to understand events which occurred after those dates.

It is believed a number of decisions made by Mr Haughey during his time in cabinet and when Taoiseach are being examined by the tribunal for any evidence of favouritism, or evidence that confidential cabinet information was passed on by Mr Haughey to associates in the business world.

When Mr Haughey was appointed Taoiseach and leader of Fianna Fail in 1979, he was already living on his estate, Abbeville, in Kinsealy, Co Dublin, and had a standard of living which could not be funded solely by his income from politics.

It is now known that for many years bills from Kinsealy were paid with money held for Mr Haughey in the Ansbacher deposits. The tribunal has been asked to inquire into these accounts and into any other accounts in the deposits from which money was transferred to Mr Haughey.

However, the tribunal, controversially, was not asked to inquire into the operation of the Ansbacher deposits generally, or to report on the identity of persons who had funds in the deposits but were not connected to Mr Haughey. The tribunal needs to establish, in so far as it can, the identities of the people with funds in the deposits, but it will only disclose the names of depositors found to have links with Mr Haughey.

The McCracken tribunal, which investigated payments from Mr Ben Dunne to Mr Haughey and the former Fine Gael minister, Mr Michael Lowry, first uncovered the secret deposits. It found that money from Irish residents was deposited in the Cayman Islands and then re-deposited back in Dublin. From the early 1970s the funds were deposited in Guinness & Mahon bank, and after 1989 the funds were transferred to Irish Intercontinental Bank. The money was technically off-shore and the identity of the deposit holders was a secret. It is understood that many of those who had funds in the deposits were hiding money from the Revenue Commissioners. To gain access to the funds, the depositors took out loans which were secretly secured by their funds in the deposits. The whole operation, which was in existence since the 1970s, was overseen by Mr Traynor.

An authorised officer, Mr Gerard Ryan, was appointed by the Tanaiste, Ms Harney, in January 1998 to inquire into the deposits. He is understood to have identified many of the Irish residents and Irish companies which had funds in the deposits and his report is likely to be completed by the summer.

However, the reports of authorised officers are confidential. The companies investigated by Mr Ryan can give permission for the publication of the report but it is unlikely the depositors would welcome the disclosure of their identities and the banks may feel obliged to protect their clients.

However, copies of the report are likely to be sent to the Director of Public Prosecutions and the Revenue Commissioners and this, in turn, could lead to prosecutions. Also, Ms Harney can initiate summary prosecutions for breaches of company law highlighted in the report. In this way the identities of the individuals and companies with funds in the deposits, may become known.

Alternatively, Ms Harney could appoint an inspector to investigate the deposits and his or her report could be published.

The companies which operated the deposits and are being investigated by Mr Ryan are: Guinness & Mahon bank; Irish Intercontinental Bank; Ansbacher (Cayman); and Hamilton Ross Ltd. The first two are the Dublin banks which held the deposits; the second two are the Cayman Islands banks which deposited funds in the Dublin banks.

Mr Ryan is also inquiring into Celtic Helicopters and Kentford Securities. Celtic Helicopters, a company run by Mr Ciaran Haughey, a son of the former Taoiseach, received loans backed by funds in the deposits. Kentford is a company controlled by Mr Traynor which was used for the transfer of funds between accounts.