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Tuesday March 29, 2011

Tribunal Finds Lowry Helped O'Brien Win Mobile License

Businessman Denis O'Brien leaving his offices in Dublin on the day when Moriarty Tribunal published its final report (Photocall)

After 14 years of investigation, and a cost of more than €40m, the Moriarty Tribunal, investigating payments to politicians, has issued its second and final report.

The 2,400-page document tells how one of the country's richest men was helped by a former Minister to acquire the State's second mobile phone license.

It also details payments of over €900,000 routed by businessman Denis O'Brien to Tipperary TD, Michael Lowry, through intermediaries after the contract was awarded.

The two men vehemently rejected the findings of the report, and launched a scathing attack on High Court judge Michael Moriarty, accusing him of basing his findings on opinions not fact.

The report concludes that:

  • It was "beyond doubt" that Michael Lowry gave "substantive information to Denis O'Brien, of significant value and assistance to him in securing the license".
  • Rather than staying at arm's length from the selection process as envisaged, Lowry had displayed "an appreciable interest" in the matter and has "irregular interactions with interested parties at its most sensitive stages".
  • His influence on the process was both direct, and indirect, "insidious and pervasive", particularly when Mr Lowry applied a "guillotine" on the process by not giving extra time to the Project Group examining the various bids to review their evaluations.
  • Mr Lowry bypassed his cabinet colleagues, and the then Taoiseach John Bruton, and "not only influenced, but delivered" the result.

The report stops short of describing the awarding of the second license to Esat Digifone as corrupt, but some of the losing bidders are now likely to sue the State through the courts.

British Telecom bought Esat in 2000, with Mr O'Brien personally netting €317m from the sale.

He now has cellphone operations in the Caribbean and Pacific regions, as well as substantial media interests in Ireland and Europe.

Forbes magazine recently listed him as the 254th richest man in the world.

Former Fine Gael Minister for Communications Michael Lowry pictured leaving the Moriarty tribunal at Dublin Castle (Photocall)

Mr Justice Moriarty concluded that several payments for the benefit of Michael Lowry were made by Denis O'Brien, all of which were routed through intermediaries and offshore accounts.

  • A IR£147,000 payment arrived to Mr Lowry's Isle of Man Irish Nationwide account through David Austin, an associate of both men, via a series of offshore accounts.
  • According to Moriarty Stg£300,000 was drawn from an O'Brien account by accountant Aidan Phelan and used to fund the purchase of a property in Mansfield, England and to fund a deposit on another property in Cheadle near Manchester, both of which Mr Lowry had an involvement in.
  • The report also says that, in 1999, Mr Lowry received support for a Stg£420,000 loan, made by Woodchester/Investec Bank, from Mr O'Brien.

The tribunal says it's reasonable to infer that motive for the payments was connected with the office of minister held by Mr Lowry.

"The Tribunal is satisfied that payments and other benefits ... were furnished by and on behalf of Mr Denis O'Brien to Mr Michael Lowry, and that these were demonstrably referable to the acts and conduct of Mr Lowry in regard to the GSM process that inured to the benefit of Mr O'Brien's winning consortium, Esat Digifone...," it says.

The word corruption is only used once in the report - and it refers to an attempt made by Mr Lowry to procure an unwarranted rent increase for a property owned by another businessman, Ben Dunne.

Mr Lowry sought to influence the outcome of an arbitration in relation to rent payable by the state owned Telecom Eireann for a building owned by Ben Dunne.

If it had succeeded, the taxpayer would have ended up paying between three and seven million euro extra in rent to Mr Dunne's company.

Justice Moriarty said the matter was "profoundly corrupt to a degree that was nothing short of breathtaking".

Justice Moriarty is scathing in his criticism of Michael Lowry, who topped the poll in his native Tipperary in the recent election.

He says that, like former Fianna Fail leader Charles Haughey, Mr Lowry showed favour to wealthy or prominent individuals in return for payments or benefits.

"In the cynical and venal abuse of office, the brazen refusal to acknowledge the impropriety of his financial arrangements with Mr Denis O'Brien and Mr Ben Dunne, and by his contemptuous disregard for his taxation obligations, Mr Lowry displayed qualities similar in nature, and has cast a further shadow over his country's public life," it says.

Taoiseach Enda Kenny has referred the report to the Director of Public Prosecutions and the Gardai, and has also accepted that his party, Fine Gael, was "wrong" in how it handled a $50,000 donation from a company associated with O'Brien's Esat bid.

Judge Michael Moriarty (Photocall)

He and Tanaiste Eamon Gilmore have called on Michael Lowry to resign his seat.

But there are no signs that this will happen.

Both Denis O'Brien and Michael Lowry have come out fighting against the tribunal's findings, including attacks on Justice Moriarty.

Mr O'Brien said the report was "fundamentally flawed", and said he had never given a red cent to Michael Lowry.

He claimed that it had been evident to him from the outset that "the final report would be designed to damage the reputations of many reputable people."

He said the chairman of the tribunal had ignored the evidence of five government ministers, a former Taoiseach, 17 civil servants and others in coming to his conclusions.

Michael Lowry said the finding that he had assisted Denis O'Brien in his bid to secure the license was "factually wrong and deliberately misleading".

He "totally rejected the tenure" of the Moriarty report and said Justice Moriarty had "outrageously abused the tribunal's ability to form opinions which are not substantiated by evidence or fact".

"From the outset Moriarty was biased," the former Minister said, "and has given fourteen years working to prove a theory that the license was improperly granted.

"The report is ultimately the opinion of the chairman and has no basis in law."

Ben Dunne too, took to the airwaves, to reject the report and challenged the chairman to prove his findings in a court of law.

"What I'm saying to Mr Moriarty is that if you believe what you are saying about Ben Dunne, then you should make sure that Ben Dunne is prosecuted and put behind bars because corrupt people should be in jail," he said.

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