Cross-Border group chief suspended in loan probe

THE head of a cross-Border body involved in distributing grants worth up to €981m has been suspended as police in the North investigate financial irregularities.

John McKinney, chief executive of the special EU programmes body and former chief executive of Omagh District Council, is under investigation as part of a PSNI probe into a €196,000 loan, the Department of Finance confirmed last night.

The EU programmes body, one of six bodies set up under the terms of the Good Friday Agreement, handles funding of up to €981m, which is distributed on both sides of the Border.

A joint statement by the Department of Finance and the Department of Finance and Personnel in Northern Ireland yesterday confirmed that Mr McKinney had been suspended on full pay following an investigation by the Northern Ireland Local Government Auditor.

The investigation centred on a 196,000 loan to a company called Fintona Regeneration Initiative Ltd by Omagh District Council during Mr McKinney’s tenure as the council’s chief executive.

It’s understood the loan was made directly from the council to Fintona in the mid-1990s.

While the EU Programmes Body last night declined to comment, a spokesman for the Department of Finance said there was no suggestion that any of the 981m Programmes Body fund was in question.

“There is no question of any impropriety in that regard,” he said.

The body is responsible for managing various EU programmes and also administers the Programme for Peace and Reconciliation in Northern Ireland and the Border Counties.

The body, also responsible for promoting cross-Border co-operation, reports to the North/South Ministerial Council and is accountable to the Northern Ireland Assembly and the Oireachtas.

Mr McKinney was also recently embroiled in further controversy involving a jobs promotion agency called Into The West, which he previously chaired.

An investigation by the North’s local government auditor and the audit unit of the North’s Department of Enterprise, Trade and Investment found that 28,000 had been wasted on spurious daily payments to delegates on business development visits.

The 15-month inquiry found Into The West had “very poor standards of administration involving considerable sums of public money”.

In particular it was found that, between January 1998 and February 2002, about 280,000 was billed to company credit card accounts held by Mr McKinney and the secretary of Into The West, Joe Doherty.

However, according to the investigation: “A large percentage of the transactions were not supported by receipts or invoices.”