State paid nearly €5m to firm refusing to testify in Moriarty Tribunal

NEARLY €5 million was paid by the State to the Danish firm that is refusing to testify about its role as independent consultants to the second mobile phone project eight years ago.

The fees went to Andersen Management International, whose former boss says he won’t give evidence to the Moriarty Tribunal now probing how the GSM2 competition was run.

Copenhagen-based AMI got fees of IR£500,000 for its work with the Department of Communications on the second mobile phone project. It also received fees of 3,953,259 for nine other licensing and regulation-related projects in the telecommunications area.

Listing the fees paid to AMI for telecom’s work, tribunal lawyer John Coughlan SC said yesterday it was strange that somebody who received this level of fees would not come to a tribunal established by Dail Eireann.

Michael Andersen, who has since sold the company, previously explained he was unable to comply with tribunal requests because of contractual problems with the new AMI owners.

Former minister Michael Lowry didn’t have any detailed knowledge of the second mobile phone licence process, project team co-ordinator Fintan Towey told the tribunal.

Mr Lowry was Minister for Communications when the Denis O’Brien-led Esat Digifone consortium won the licence competition for the State’s GSM2 project in October 1995.

State lawyer Richard Nesbitt SC asked the former department official if he thought Mr Lowry could have had a sufficient understanding of how the project was working to have intervened to change the way the project group was doing its business.

“To my knowledge all he received were superficial progress reports,” Mr Towey replied. “I don’t believe he had any level of depth of understanding of the detail of the process or of how it worked.”

He added: “To the very limited extent that the minister was aware of the progress of this project, I didn’t view any of those contacts as giving rise to interference or any influence in relation to the project.”

Earlier, Mr Towey said he considered a letter, received from financier Dermot Desmond’s IIU company while the six GSM2 bidders were being evaluated, was inappropriate and should be returned to Esat Digifone.

He said he saw the letter as a breach of the competition rules. “I took the clear view that it was an attempt to enhance the application of Esat Digifone.”

Mr Towey added: “It was very prominent in my mind that we had very clear rules designed to ensure fair play between applications and there was a clear prohibition on new information being provided to the department.

“In the case of this particular consortium, just two weeks earlier at the end of their presentation there was a very clear exchange between Martin Brennan (project team chairman) and Denis O’Brien along the lines ‘don’t call us, we’ll call you’.

“Apart from the general rules, there was a sense in this case there had been a clear breach of the rules,” Mr Towey told Mr Nesbitt.