By far the most extraordinary revelation of the McCracken tribunal was that in 1990 there was £38 million on the books of Guinness and Mahon (Ireland) Ltd, College Green, Dublin, owned by Irish citizens and held in a manner that appears to have been designed to avoid tax. Actually, there was more than £38 million on the books of Guinness and Mahon at the time for there were stocks and shares as well.
Incredibly, the proposed terms of reference of a new tribunal, to be established by the Dail tomorrow, fail to include an inquiry into the operation of this extraordinary account, except in so far as it relates to Charles Haughey. Apparently, the new tribunal is not to inquire who were (are) the beneficial owners of this vast amount of money, what was the purpose of money being routed through the Cayman Islands, what were the tax implications of these transactions and what professions and others were involved in these transactions.
The tribunal is also not going to inquire into the financing of Fianna Fail and Fine Gael, which, in the circumstances, is bizarre but hardly surprising.
The tribunal is to examine whether Michael Lowry received any large payments other than those he got from Ben Dunne and whether the receipt of such payments was in any way linked to the discharge of his duties as Minister for Transport, Energy and Communications.
But Michael Lowry had been engaged in getting money not just for himself but for Fine Gael as well (£180,000 from Ben Dunne alone) and also for certain individuals in the party whom, for whatever reason, he (Michael Lowry) singled out for the special favour of Ben Dunne's money.
So why shouldn't Fine Gael's finances be investigated as well as Michael Lowry's, and why shouldn't the executive actions of members of Fine Gael be examined to inquire into whether such actions were linked with monies the party and members of the party received?
Fine Gael's financial health underwent a remarkable transformation from the moment the party was miraculously restored to government in December 1994. Until then the party was in deep financial trouble, and within two years it was out of that deep financial trouble. How did this happen?
It is a question as obvious as was the question concerning Mr Haughey's financial affairs for decades: how was it that when he entered politics he was a man of modest means, and when he was in politics for 15 years he was a man of lavish means? The question for Fine Gael is: how come that when it went into government it was in financial distress and within two years in government it was in financial abundance?
For Fianna Fail the question is similar. Charles Haughey while in office did not just amass a fortune for himself, he spent a fortune on behalf of Fianna Fail on elections. More than £10 million was spent on the elections Fianna Fail fought while he was leader (1981, February 1982, November 1982, 1987 and 1989). Where did this money come from, what favours were done for those who contributed such vast amounts - even allowing for the debt that was accumulated, a vast war chest was assembled while Charles Haughey was leader of the party. So how did Fianna Fail come by such vast finances and what favours were done for it?
Instead of examining these three very crucial issues, the new tribunal, apparently, is going to flog two dead horses - well, half-dead horses. We know already that Charles Haughey obtained money improperly and that he lied about it. The most we can find out about him now is that he may have got even more money improperly, that he may have lied about it and, perhaps, that he may have done favours for it.
I am not suggesting the new tribunal should not inquire into these matters, rather I am suggesting that there are a great many more important matters now to discover and it is extraordinary that the terms of reference ignore these more important issues.
It is particularly incomprehensible that the tribunal is not to inquire into the Ansbacher accounts - the £38 million-plus in Guinness and Mahon. The background to these accounts is as follows.
IN 1969 Guinness and Mahon (Ireland) Ltd set up a subsidiary company in the Cayman Islands, Guinness Mahon Cayman Trust Ltd. The Cayman Trust was eventually taken over by a London bank, Ansbacher Ltd, and the Cayman Trust became known as Ansbacher Cayman Ltd.
According to the McCracken report, from the mid-1970s Ansbacher Cayman placed substantial deposits with Guinness and Mahon (Ireland) Ltd, which by 1989 had grown to approximately £38 million. This was money deposited by persons resident in Ireland with Ansbacher Cayman Ltd and the money was then lodged in bulk with Guinness and Mahon (Ireland) in College Green in the name of Ansbacher Cayman. Up to the time he died, Desmond Traynor, Mr Haughey's close associate, organised the deposits in Ansbacher Cayman for the Irish residents.
The records of these deposits were kept on the computer of Guinness and Mahon, but only Mr Traynor and his associate, Padraig Collery, had access to them. When the Ansbacher Cayman account was moved later from Guinness and Mahon to Irish Intercontinental Bank Ltd, Mr Traynor and Mr Collery continued to have direct control over them and they alone had access to the records.
The effect of this arrangement was that the monies deposited by Irish residents were eventually lodged in an Irish bank (Guinness and Mahon) but with no record in Ireland of such deposits. The cost to the Irish depositors of these transactions was merely one-eighth of 1 per cent.
The McCracken tribunal noted: "This was a very ingenious system whereby Irish depositors could have their money off-shore, with no record of their deposits in Ireland and yet obtain an interest rate which was only one-eighth less than they would have obtained had they deposited it themselves in an Irish bank."
It is inexplicable that the new tribunal would not be required to investigate the background to these vast deposits and how they could remain outside the supervision of the Revenue Commissioners and the banks' regulatory authorities. It is very unlikely the Supreme Court would find that such an investigation was unconstitutional on the grounds, for instance, of an infringement of the constitutional right to privacy. If that should be the outcome in the Supreme Court, so be it, but at least the tribunal should be empowered to try to make such investigations.
There are likely to be other constitutional difficulties about a new tribunal. A constitutional change, via a referendum, on the issue of Cabinet confidentiality may well be found not to be retrospective - in other words the proposed amendment would apply to Cabinet discussions henceforth, not retrospectively. That too could be a major problem.