The Revenue Commissioners has made a £151,000 (€191,000) settlement with an investor in the Clerical & Medical International offshore bond scheme promoted by National Irish Bank. Mr Gary Skelton, a company director, whose name appeared on a list of tax defaulters published last week was a participant in the scheme.
Along with other selected National Irish Bank customers he was encouraged to buy an investment bond from the Isle of Man based company which then put the money on deposit with National Irish Bank in Ireland. As the money was in the name of the offshore company it was not liable for tax although in many cases the Irish investor could have access to their money by cashing all or part of the bond. Mr Skelton, who operates a flooring business, declined to comment this week on his involvement with National Irish Bank. According to the figures published by the Revenue Commissioners, Mr Skelton underpaid £64,450 in tax and paid a total settlement including penalties of £150,897. His address is given as Kempton Grove, Navan Road, Dublin 7.
Ms Beverly Cooper-Flynn, the Fianna Fail TD, was involved in the marketing of the bonds when she worked for National Irish Bank Financial Services before her election to the Dail in 1997. She refused to comment yesterday on whether Mr Skelton had been one of the 65 people she introduced to the scheme. "I cannot comment on any matter to do with National Irish Bank," said Ms Cooper-Flynn, who is a member of the Dail Committee of Public Accounts, ail committee which has been investigating the abuse of non-resident accounts.
Ms Cooper-Flynn has denied she advised people to invest in the bonds as a way to evade tax.
The Revenue refused to comment on Mr Skelton yesterday. A spokesman said that starting with the next quarterly list of defaulters they would detail the tax evasion behind any settlement. This is in line with measures introduced in the last Finance Act to ensure that any participants in the CMI scheme and other tax evasion schemes such as the Ansbacher accounts that settle with the Revenue Commissioners will be identified.
National Irish Bank was forced to hand over the name of Mr Skelton and the other 280 customers who invested £50 million in the bonds between them. Around 100 of the customers, who invested £14 million were resident in Ireland and not legally entitled to invest in the offshore scheme. Some customers invested in similar products from Scottish Provident International in the Isle of Man and Old Mutual in Guernsey. Most of the investors in the bonds were existing customers of the bank who had substantial funds on deposit.
The sale of the CMI bonds is being investigated by two High Court Inspectors appointed following an inquiry into the bank by the Department of Enterprise and Employment in 1998. The two inspectors - Mr John Blayney, a former Supreme Court judge, and Mr Tom Grace, a senior partner at PricewaterhouseCoopers, are unlikely to complete their inquiry until next year.
Mr Skelton's was the second largest settlement listed in Iris Oifigiuil. Mr Michael Hayes, a farmer and boutique owner of Walshestown, Castlemahon, Co Limerick, underpaid £85,990 in tax and was required to pay £223,000 as a settlement.
