Due to the failure of the Company to co-operate with the examination carried out by the Authorised Office, the Report of the Authorised Officer contains an incomplete picture of the Company's operations in Ireland since 1971. From records and documents of the Company's activities in Ireland which were provided by GMI, IIB, HRC and KSL, the Authorised Officer has identified over 100 individuals, the vast majority of whom would appear to be Irish tax resident, who were clients of the Company. He is of the view that there are many other unidentified persons resident in Ireland with whom the Company has or has had a commercial relationship. A significant number of Irish residents appear to have dealt directly with the Company during the 1980s and 1990s and may not have transacted any business with the Company via GMI or IIB. The sums identified by him in the Report involved some £50 million placed by the Company on deposit in GMI in l989, rather than the £38 million indicated on page 36 of the McCracken Report. There is evidence in the Report of the Authorised Officer which indicates that some of the Company's deposits placed with its successive London parent companies, firstly with Guinness Mahon & Co. Ltd. And later with Henry Ansbacher & Co. Ltd., represented monies deposited with the Company by trusts and companies managed by the Company on behalf of Irish residents.
An examination of the 120 persons identified in the Report as being clients of the Company or connected with deposits placed with the Company, including a significant number of which there is evidence that they dealt directly with the Company in the 1980s and 1990s, suggests that cash deposits and investments of which such Irish persons were beneficiaries through trusts and overseas companies, may have been far greater than the £50 million placed by the Company on deposit in GMI. According to the Authorised Officer, it is likely that the total assets of such trusts and companies may have been of the order of a few hundred million pounds.
An authorised officer, appointed under S.19 of the 1990 Act, has no power to require customers etc. of a company, being the subject of his appointment, to produce documents or to provide explanations, of documents or otherwise. Inspectors appointed by this Honourable Court under S.8 of the 1990 Act have extensive powers under S.10 of that Act to obtain information and explanations from a wide range of persons. Should this Honourable Court appoint inspectors to investigate the affairs of the Company, such inspectors would be in a position to examine, under oath, some or all of the 120 clients of the Company (and any other clients which they might identify). The Minister is of the opinion that inspectors, appointed by this Honourable Court, could by this means, accomplish much in terms of investigating the affairs of the Company even if the Company continues in its refusal to recognise the jurisdiction of this Honourable Court.
Having read the report of the Authorised Officer, the Minister is of the opinion that, as a matter of probability, the clients of the company must have, from their dealings with the Company, a considerable amount of information as to its affairs and how it conducted its business. In particular, such persons must know how they themselves lodged monies to accounts, under their effective control, in the Company. Such persons are likely to have, in their possession, documents relating to the conduct of the affairs of the Company and the manner of the carrying on of its business in Ireland. Unlike an officer authorised by the Minister, inspectors appointed by this Honourable Court can require such persons to disclose to them such information and to produce to them such documents.
In addition to the past and continuing failure of the Company to submit to Irish Company Law, the Minister is greatly concerned at the level and extent of the deposits which appear to have been held "offshore", through trusts and companies, for the benefit of such individuals and the manner in which the Company facilitated the operation of a lodgement and withdrawal system for the benefit of such individuals which prima facie suggests that tax evasion and, for certain periods, exchange control regulation evasion were being actively facilitated.
I say that it is of concern to the Minister that the evidence in her possession tends to suggest that the Company may have been formed for this unlawful purpose or, at the very least, carried on this unlawful purpose for a substantial period of time. In order to investigate this aspect of the Company's business, it is necessary, in the Minister's view, to have competent Inspectors appointed by this Honourable Court.
Destruction, etc. of Books and Documents
As outlined above, page 50 of the McCracken Report records that Mr John Furze, a former director of the Company, destroyed a number of the books and documents of its Irish business in Ireland in 1994 and took some files back to the Cayman Islands. With the agreement of Officials of the Company. Mr Padraig Collery also subsequently destroyed many of the remaining files of its Irish business.
The Minister has been advised that of the above circumstances suggest that officers or agents of the Company may have breached section 243 of the Companies Act, 1990 by the destruction or mutilation of specified books and documents. She is also advised that such an offence is regarded as a serious breach of the Companies Acts.
