Poor Reflection

Denis O’Brien doggedly pursued business and wealth, so he is unlikely to give up on his challenge to Moriarty’s findings, says Seán McCárthaigh

THE unambiguous findings of the Moriarty Tribunal will have been greeted with anger and resentment, but little surprise by the man who became the central focus of the long-running inquiry.

For over the past decade, the Moriarty Tribunal’s scrutiny of his business dealings has been a constant irritant and distraction for Denis O’Brien as he set about building a large global empire that now spans several continents.

Shrinking violets do not as a rule go on to become international telecom and media moguls. So it comes as no real wonder that O’Brien has used both the courts and various media to challenge the work of the inquiry’s legal team at every stage of its lengthy investigation.

With the damning findings of this week’s final report by the Tribunal chairman, Mr Justice Michael Moriarty, that O’Brien had paid around £1m to Michael Lowry in the years after the former Fine Gael minister had helped the businessman to win the mobile phone licence, the Esat founder has unsurprisingly shown no hesitation in going on the offensive to try and salvage what’s left of his shattered reputation.

But he has also gone down the dangerous road of questioning the judge’s independence as well as the integrity of the wider judiciary with some of his comments.

The Cork-born entrepreneur has rarely tried to conceal his contempt for the inquiry’s detailed, forensic examination of how his Esat consortium won the lucrative second mobile phone licence for Ireland in 1995.

Unrelenting in his insistence that there was nothing untoward in his relationship with Lowry, whose department oversaw the awarding of the licence, O’Brien has had to wait over a decade for the tribunal to reach its own verdict on such a claim.

During that period, the 52-year-old businessman was also busily engaged in building a vast telecommunications and media empire. (Just a few weeks ago, he was listed in the Forbes global rich list at number 254 with an estimated personal wealth of $4.2 billion (€3bn). Media reports of the public hearings at Dublin Castle have also angered O’Brien.

Last year, he even established a website — www.moriartytribunal.com — which aimed to rebut some of the allegations raised against him as well as highlighting what he would regard as deficiencies and bias in the approach adopted by the tribunal’s legal team.

Such actions, no doubt, were utmost in Mr Justice Moriarty’s mind when he commented in his report on “certain excesses of ‘spinning’” primarily orchestrated by O’Brien, which he also branded as “rabid and puerile”.

O’Brien has also spent well in excess of €9m of his personal fortune in legal bills linked to his representation at the Tribunal and several (largely unsuccessful) High Court and Supreme Court challenges to the work of the inquiry.

However, the sum could be multiplied several times over by the time O’Brien exhausts all legal challenges to try and overturn the Tribunal’s findings combined with the probability that he will also be ordered to pay some of the inquiry’s own costs as he was one of those who engaged in “persistent and active concealment” of evidence.

To the casual observer, O’Brien might seem to have been justifiably outraged by the tribunal’s apparent infatuation with the manner in which Esat won the mobile phone licence.

However, it was inevitable that the licence competition would come onto the inquiry’s radar, like all other major decisions taken by Lowry as a government minister, following the scandal surrounding his resignation in 1996 after it emerged that Dunnes Stores had paid for major renovation work on his Tipperary home.

Although the tribunal never uncovered any “smoking gun” that would provide direct evidence of corruption in the manner in which the phone licence was awarded, it did identify what its chairman, Mr Justice Moriarty, described in September 2005 as “apparent deviations” from strict confidentiality rules set up to prevent any chance of political interference in the competition.

The fact that O’Brien’s Esat group was somewhat of a surprise winner of the licence ahead of five other competitors, including leading telecom groups like Persona and Motorola, did not help to allay suspicion over the years.

With the benefit of hindsight, it probably didn’t help that the shareholding of controversial financier, Dermot Desmond, who came to the rescue of O’Brien when there was serious concern about Esat’s ability to finance a new mobile phone network, was never made known to the group of senior civil servants who assessed the rival bids.

But central to the whole issue of why the tribunal spent such a considerable period examining O’Brien’s business affairs was the emergence of evidence (notably uncovered by journalists and not the tribunal itself) about a number of large financial transactions involving the entrepreneur, which ostensibly could be linked to payments to Lowry, especially in relation to a number of property deals in Britain.

For his part, O’Brien consistently maintained that he had no knowledge of making any payments which conferred a benefit to the former Fine Gael minister.

However, to fulfil its terms of reference, the tribunal spent many long, boring days in Dublin Castle examining in exhaustive detail the complex formula devised to assess the various bids for the phone licence in what became known as “the tribunal within a tribunal.” Such a process had been designed to ensure the maximum security and to exclude the possibility of any political interference.

O’Brien, a tax exile who currently resides in Malta having spent many years domiciled in Portugal, ultimately made a personal profit of £230m (€292m) after he sold Esat Digifone to British Telecom having been awarded the mobile phone licence for just £15m (€19m).

The businessman used the profits to expand the development of his Digicel’s mobile phone operations in the Caribbean region and also his Communicorp media empire which he had started earlier with the establishment of 98FM — further proof of his ability to win a licence from the state in an open competition. O’Brien’s troubles with the tribunal didn’t prevent him from adding the country’s two largest independent radio stations — Today FM and Newstalk — to his burgeoning media portfolio.

However, his most controversial investment in the world of media was his decision to take a 26% stake in Independent News & Media in a move which cost him around €300m and which was largely seen as an attempt by O’Brien to mount a takeover of the publishing empire established by his rival, Tony O’Reilly. It was a heavy price, as more than 80% of the value of his investment has since been wiped out and his shareholding has dropped to 13.8% as a result of a major restructuring of the group.

O’Brien has also suffered a number of setbacks including his investment in Aer Lingus which also recorded large losses. In 2008, his Boxer consortium was awarded the licence to provide Digital Terrestrial Television by the Broadcasting Commission of Ireland, although the group subsequently relinquished it amid fears that it would not be profitable a result of the global economic downturn.

In between, O’Brien has also managed to engage in several charitable works, most notably as chairman of the Special Olympics when they were held in Dublin in 2003, the Haiti Action Network and the establishment of Frontline — a foundation to provide support and protection to human rights workers at risk.

Dare one say it, but his investment in Glasgow Celtic football club could also be viewed as being done for less than purely commercial reasons.

He also endeared himself to Irish sports fans by his decision to fund half of Giovanni Trapattoni’s salary which enabled the FAI to secure the services of the talented Italian football manger for the Republic of Ireland national squad.

To employ a soccer analogy, O’Brien is unlikely to regard the publication of the tribunal’s report as signalling full-time in this long-running saga. He has already indicated that he intends to lodge a complaint against the inquiry to the European Court of Human Rights.

But the question will forever remain: did he engage with Lowry to corruptly acquire the mobile phone licence that catapulted him to billionaire status or is he an innocent man who has suffered from an unfortunate series of coincidental money transactions that might suggest otherwise?

Regardless of this week’s findings, it seems certain O’Brien will pursue this case as doggedly as all his other projects. The man knows no other way of doing business.