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8 November 2014
and when she appointed Ryan to investi-
gate them. The papers revealed how more
than 200 members of the Irish business and
political elite, including senior FF, FG and PD
ministers, used the complex offshore mecha-
nism to avoid tax from 1977 until 1995.
In early 1999, Harney muttered a few
words about her “conditional” loyalty to the
Ahern government after EU commissioner,
Padraig Flynn, imploded on the ‘Late Late
Show’ over the 1989 €50,000 donation by
Tom Gilmartin to Fianna Fáil which ended up
in the then minister’s personal bank account.
She was particularly nervous as Gilmartin
had dragged Ahern into the affair by claim-
ing to have met him on a number of occasions
I
T should come as little surprise that a
former Progressive Democrat minister
is among those named in the dossier on
tax evasion compiled by Gerry Ryan, the
civil servant who has been investigating
the Ansbacher files since 1998 and whose
inquiry was closed down by then Tánaiste,
Mary Harney, in 2004.
After all, Mary Harney and the PDs had
plenty of form in this regard during their
power-sharing years with Charles Haughey
in the late 1980s and then with Bertie Ahern
from 1997. Indeed, her seat at the table was
barely warm when Harney was forced to
grapple with her conscience as it was con-
firmed that her cabinet table, Ray Burke,
had taken large chunks of cash during the
general election of 1989 leading to his res-
ignation that Autumn and the establishment
of the Flood tribunal.
Of course, Harney was familiar with such
shenanigans as she presided over an incon-
clusive internal inquiry into an alleged
donation to the PDs during the same elec-
tion that went to fund the campaign of their
Waterford candidate, Martin Cullen, rather
than to the central party coffers - much to the
chagrin of local fundraisers.
In 1998, she had the misfortune of mak-
ing ill-advised comments to the Irish
Independent about the integrity or oth-
erwise of the party’s original adversary,
Haughey; and her comments resulted in a
decision that the former Taoiseach could
not be prosecuted for his improper receipt
of over €1 million from retailer Ben Dunne
and related matters.
This was the same year that the explosive
Ansbacher documents landed on her desk
and had informed him in 1989 about the
missing Flynn donation.
Having crossed this particular hump,
Harney was forced to agonise again early
that summer when it emerged that Joe Burke,
a friend of Ahern’s, had intervened to help
secure the early release of Philip Sheedy,
an architect serving a sentence for killing
a woman in a road incident. Two judges,
including Supreme Court member, Hugh
O’Flaherty, fell on their swords but the
summer recess and the victory of Harney’s
conscious once again kept her on board.
In February 2000, Mary Harney gave an
undertaking the authorities would carry out
a comprehensive investigation into anti-
NEWS
Also in this section:
Social protection 10
Community confusion 12
Ansbacher 14
Laura Harmon interview 16
JobPath privatisation 17
The compromised ‘party of conscience’ merits continuing scrutiny.
By Frank Connolly
Toxic PDs
November 2014 9
competitive practices at CRH, but this has
never happened. Patrick Massey, then head
of the Competition Authority, resigned his
position that very same month stating: “it
is no longer possible for me to continue as
director of competition enforcement due to
the failure to provide adequate resources to
enable me to do the job properly. My expe-
rience has convinced me that price-fixing
cartels represent a serious widespread prob-
lem in this country…the resources available
are wholly inadequate for carrying out the
sort of complex and highly intensive investi-
gations that are required to obtain evidence”.
Massey went on to say, “certain complaints
made to me in recent months involve matters
that would occupy four or five staff full-time
for the best part of a year. I simply do not
have such staff resources and given the very
real concerns expressed to me by the com-
plainants as to the consequences for them
if the matter is not pursued properly, I have
concluded that it is simply not possible to
pursue the matter”.
In 2004, during her second term as
Tánaiste and as she left her position as enter-
prise minister, Harney decided to terminate
the Ryan investigation followed another tor-
rid few years of controversy not least as the
Moriarty and Flood/Mahon tribunals con-
tinued to uncover extraordinary details of
corrupt behaviour by FF, FG and PD politi-
cians and as the latter inquiry came closer to
unravelling the convoluted financial affairs
of the then Taoiseach going back to the late
198 0 s.
When she aborted the investigation, it
was not known of course that among the
suspected tax evaders was one of her party
colleagues and a (former) minister but it
did not go unnoticed that she had an appar-
ent aversion to investigating the affairs of
Ireland’s largest corporate monopolist and
a central player in the Ansbacher affair,
Cement Roadstone Holdings (CRH).
At the time, Vincent Browne wrote;
“Among the plethora of recurring self-re-
garding proclamations Mary Harney makes
about herself [‘anyone who knows me…..’] is
the boast that she and her party are commit-
ted to taking on monopolies and freeing up
the market for the benefit of the Irish con-
sumer. And indeed, this government has
taken on goliaths such as taxi drivers, bus
workers and now airport employees. But
when it comes to the big boys - and espe-
cially when it comes to the biggest boy of
all, the most gigantic monopoly in the his-
tory of the state, construction conglomerate
Cement Roadstone Holdings [CRH] – it’s a
different tune”.
This is no doubt surprising for many who
believed that the company with which her
party’s nemesis had such a close connec-
tion would surely be good hunting territory
for the uber-ethical PDs. The links between
Roadstone and the former FF leader stretched
back to the 1960s when his father in law,
Sean Lemass, was chairman of Roadstone
which went on to become CRH.
In 1969, Roadstone Ltd sold 80 acres of
land to Haughey, then Minister for Finance,
for £120,000. In 1973, Haughey sold 17.5
acres of that land back to CRH for £140,000.
Within four years, Haughey had made a net
profit of £20,000 and 62.5 acres at CRH’s
expense.
The Ansbacher accounts set up in 1971
were funds lodged in Ireland by the Cayman
Islands bank, Ansbacher (Cayman) Ltd. The
unauthorised financial service was run in
secret by the late Des Traynor who previously
worked with Haughey Boland, the former
Taoiseach’s accountancy practice. The sys-
tem allowed account-holders to lodge money
with Guinness & Mahon Bank in College
Green, which was then held offshore.
The scheme, first disclosed in 1997 dur-
ing the Mc Cracken tribunal’s investigation
of payments from Ben Dunne to Haughey
and Michael Lowry, was later run out of
CRH headquarters on Fitzwilliam Square
when Traynor was its chairman. In 2002, a
report identified 200 holders of Ansbacher
accounts, including Haughey and members
of the CRH board.
High Court inspectors, led by the late
Justice Declan Costello (who once held a
domestic Guinness and Mahon account) into
offshore Ansbacher found that CRH “did not
knowingly” operate the illegal bank. This
was despite the fact that eight out of 15 CRH
directors had Ansbacher accounts and that
the bank was run from CRH’s headquarters
by Traynor who was Haughey’s personal
financier.
Responding in early 2005 to a question by
Labour leader, Pat Rabbitte, about her deci-
sion to end the Ryan investigation, Harney
said she felt it was time to bring the investiga-
tions to a conclusion seven years on and that
she was under the impression they would
have concluded much earlier. She says she
submitted the Ansbacher report (by Ryan)
to the Revenue Commissioners, the DPP and
other authorities.
“Much of the work that the authorised
officer (Ryan) was uncovering was also in the
remit of the various tribunals. I directed the
authorised officer to send much of the mate-
rial he acquired to the relevant tribunals
because I judged it was more relevant to their
work than to a company law inquiry”.
Rabbitte replied that Harney’s action “lays
itself open to the belief that the investigation
was not terminated because it had come to
fruition, but rather because it might do so”.
Harney insisted she acted properly through-
out her time as enterprise minister.
The Moriarty tribunal which might have
been the more appropriate agency to inves-
tigate as it was already dealing with the
Dunne/Haughey allegations did not man-
age to make any further inroads due to a
lack of resources, according to its chairman,
Justice Michael Moriarty. It was clear that
any inquiry would have to embrace the role
of CRH in the long running scandal.
Unfortunately, during the investigation
it materialised that Justice Moriarty held
approximately £500,000 in CRH shares
and this in his opinion precluded him from
investigating CRH. Until the
most recent disclosures by Ryan
about the failure of subsequent
ministers and other agencies to
deal with the outstanding issues
arising from his investigation
into the Ansbacher accounts,
the issue faded from the public
discourse.
As Harney and the PDs rolled
from one crisis to the next in the
Ahern led government, she was
eventually deposed by her dep-
uty and rival, Michael McDowell,
as the 2007 election approached.
When Ahern made his infamous
and tearful appearance on the
RTé News in September 2006
to explain how his assorted
friends had gave him substantial
‘dig-outs’ when he was finance
minister in between 192 and
1995, McDowell had a wobble
and demanded clearer explanations from
the Taoiseach.
He then stuck firmly to government until
the eve of the general election in May the fol-
lowing year when he threatened to jump ship
after Ahern’s explanations of his financial
affairs defied any logic or belief.
Once again, the political instinct for sur-
vival overcame whatever McDowell’s legal
nous might have dictated. This time, how-
ever, the voting public was not prepared
to reward the ‘party of conscience’ as its
founder Des O’Malley liked to regard his cre-
ation. Even he was horrified when McDowell
resigned as party leader and from politics as
his troops lay injured on the battlefield dur-
ing the election count. The PDs were history
and the lesson of their complicity should be
heeded by all of those attracted by the new
version now touted by Lucinda Creighton and
her assorted right-wing allies. •
Harney’s
comments
resulted in
a decision
that Haughey
could not be
prosecuted for
his improper
receipt of over
€1 million from
Ben Dunne
“
