AN "astonishing" rental seam being investigated by the Fraud Squad cost the Office of Public Works more than £176,000, the Dail Committee of Public Accounts was told yesterday.
The money paid for the rental of five properties used as Garda stations was collected by a fraudster purporting to be from a firm of solicitors in Dublin. The OPW would compensate the real owners for the £176,805 rent which went unpaid, its chairman, Mr Brian Murphy, confirmed.
"This was forgery, false letterheads, an astonishing situation," he said. "The people to whom the money should have been paid did not complain until 1992."
Refurbishment work on Dublin Castle in advance of a series of political summits, meanwhile, overran its £10 million budget by more than £2 million, the committee heard.
The Report of the Comptroller and Auditor General identified irregularities in relation to the OPW's payment of rent for a property in Co Tipperary which came to light in October 1995. It became apparent that details regarding the landlord had been falsely altered, resulting in false payments being made.
Solicitors claiming to represent the property's owners had already written to the OPW in 1992 seeking an explanation as to why rent, which had been paid since 1986, was outstanding for several years.
OPW records, however, showed that rent had been paid since 1986 to a firm of solicitors with an address in Dublin. The OPW immediately requested evidence of the solicitors' bona fides but got no response. In 1995, another request was made. A subsequent search revealed that the relevant files had gone missing.
Further investigations conducted by the OPW's internal audit unit unearthed another suspicious case involving a property in Co Galway. This money was being paid to the same firm of solicitors and these files were also missing.
A further three cases were uncovered, bringing the total payments by the OPW to £176,805 between 1984 and 1995. All five properties were rented for use as Garda stations and were estates which were being passed on following the owners' death.
The property owners, however had not contacted the OPW in relation to the outstanding rent owed, the committee was told.
Mr Murphy said the rents for these properties were increased during this period, but not by such an amount as to give rise to suspicion. The rents averaged £5,000 annually which was insignificant" in terms of the rent paid by the OPW, he said.
Mr Murphy said the OPW had received instructions in writing to make payments via another firm of solicitors. The letter had been properly headed, but later inquiries revealed the addresses given were false.
Responding to questions as to whether any OPW employees had been suspended, Mr Murphy replied that they had not. The matter was being investigated by the Garda.
The committee also heard that refurbishment of the Dublin Castle complex and nearby properties cost £12,386,807.
The 1994 budget had set aside £10 million for the continued refurbishment of the complex - £8 million for the restoration of nine houses in Ship Street and £2 million for work on the Garden and Coach House.
In March 1994, the OPW bad accepted a revised tender for £6.66 million for the Ship Street work from the lowest tenderer.
Mr Murphy accepted that the tender was underestimated and said the OPW should have used its experience of other projects at Dublin Castle to have ensured the costing was correct.
However, the horrendous condition of two of the buildings in Ship Street could not have been anticipated, he said.