THE State is expected to seek tax payments on at least £5.7 million of alleged undeclared earnings by the man at the centre of the investigation into the murder of the journalist, Veronica Guerin.

Examination of receipts from bookmakers show that the man placed £5.7 million in bets between November 1994 and July 1995 as part of a money laundering scam.

It emerged yesterday that the former Cork City State Solicitor, Mr Barry Galvin, has been appointed a temporary tax inspector with the apparent intention of serving a tax demand on the suspect and one of his associates, who also has very large undeclared earnings.

Mr Galvin is legal adviser to the Garda's Criminal Assets Bureau (CAB), which includes Customs and Revenue officials and officers seconded from the Garda Fraud Bureau. He was appointed to the position of tax inspector under the Government's anti-laundering legislation, the Certain Information for Taxation and Other Purposes Bill.

It is understood Mr Galvin will receive Garda protection as he proceeds with the attempts to serve demands on the criminal figures.

The CAB has received documentary evidence as to the Guerin murder suspect's earnings primarily through the records kept by bookmakers. He has never regularised his tax affairs, although he is the beneficial owner of a business valued at up to £3 million.

During the investigation into Ms Guerin's murder in June, the form of his money laundering emerged. Gardai visited book-makers, many of whom work on course at racing events, and discovered the extent of his earnings.

The tax liability on the earnings has yet to be disclosed but it could run into millions of pounds.

No notice has been served on the criminal to date. He had been abroad since the time of Ms Guerin's murder but returned to the Republic by ferry from France last week to attend his wife's birthday party. He remained in the Dublin and Co Kildare area for five days, then left again with another man who is said to be his "minder".

His illegal earnings are understood to come principally from cigarette, tobacco and drug smuggling.

The CAB is also expected to move against a close associate of the criminal, a man with whom Ms Guerin made regular contact.

An £80,000 Mercedes car belonging to this main was seized by gardai two months ago and remains impounded and unclaimed. An estimated £30,000 in hire purchase finance remains unpaid on the car and it is expected that it will eventually be seized by the finance company.

This man also has very large undeclared earnings. He was involved in running prostitution and gardai questioned a number of prostitutes working for him.