Fine Gael’s failure to reveal $50k donation ‘regrettable’

FINE GAEL’S failure to disclose a secretive $50,000 donation it received from one of the partners in the winning consortium was “regrettable”, the Tribunal has said.

“No person or entity connected with the payment saw fit to notify the Tribunal of it, notwithstanding a substantial degree of knowledge of its clandestine circumstances and proffered return,” Mr Justice Moriarty said.

The donation from Telenor, coming as it did just a few weeks after the Esat Digifone consortium had won the licence competition, was “inappropriate and imprudent”.

But while the tribunal criticised Fine Gael’s failure to disclose the donation, it reserved its harshest criticism for the consortium for making the payment in the first place.

The donation was made in a manner which “was secretive, utterly lacking in transparency, and designed to conceal the fact of such payment by or on behalf of the donors,” the report said.

Details of the donation would “have remained hidden from public knowledge” had it not been for a report by the then Sunday Tribune editor, Matt Cooper, in 2001.

The background to the donation was the substantial debt accumulated by Fine Gael by the time it entered government in December 1994.

Michael Lowry was then chairman of the trustees of Fine Gael, and there was a belief that the party could seek to raise funds in the US to help clear the debt.

David Austin, a senior businessman involved in fundraising activities for the party, organised a private dinner at an exclusive club in New York in November 1995 with various Fine Gael cabinet members as the guests of honour.

The dinner was held just a little over two weeks after the announcement that Esat Digifone had succeeded in the licence competition.

After being contacted by Mr Austin, Esat boss Denis O’Brien suggested that Telenor, as a partner in the consortium, might make a contribution.

Telenor proceeded to make a $50,000 donation, with Mr Austin assuring the company that an invoice would be issued to make the payment look as if it was in return for “consultancy work”.

The payment was made to an offshore bank account controlled by Mr Austin.

But in February 1996, when Mr Austin informed the then Taoiseach John Bruton about the donation, the latter was adamant that Fine Gael should not accept it, given its source.

The money was left resting in the offshore account until, in the run-up to the 1997 election, Mr Austin rang Fine Gael headquarters and said he wanted to make a sizeable “personal” donation.

The $50,000 was subsequently transmitted to Fine Gael.

But over the following months, as the tribunal began its inquiries, Telenor grew anxious and sought to ensure the money had actually gone to the party rather than Mr Lowry.

When Mr Bruton learned the payment had been received by the party, he ordered it returned immediately.

But Fine Gael received legal advice that the donation did not fall within the tribunal’s terms of reference.

As a result, it failed to notify the tribunal about the donation.