School blamed for demise of €161k IT contract

The man whose company was blamed for defaulting on a contract that left County Cork VEC with a €161,000 shortfall has said school authorities were responsible for the demise of the deal.

Jonathan O’Shea, the former chief executive of Mobile Voyager Solutions (MVS), said he had his reputation tarnished by the reaction to the controversial computer project.

This was after the unusual agreement underpinning it broke down between his company and its partner school, Glanmire Community College, in 2006.

Mr O’Shea, originally from Carrignavar in Cork, said his solicitors in Ireland have been briefed by him about what he called “lies”.

He said these circulated following reports by County Cork VEC and the Comptroller and Auditor General into the matter.

Mr O’Shea, who now lives in the Czech Republic, is currently the chief executive and majority shareholder of a separate company, Simple Touch Ltd. In 2006 this firm purchased the 3D animations and materials developed by MVS in Glanmire.

This was all done legally and when his new company was established it attracted more than €400,000 in investment and had plans pitched to animation developers in Walt Disney and Apple.

But Mr O’Shea claimed the MVS project would have been more successful if CCVEC fulfilled its part of the bargain.

“The school never followed through on the agreement. They were supposed to supply the company with content, they were supposed to supply the company with people who would work from their side on content.

“That never happened, which went into delays, which went into costs to the company... so hence they broke the agreement of the contract,” he said.

Neither CCVEC or Glanmire Community College commented on his claims.

The Public Accounts Committee, which tomorrow will investigate the money lost in the deal, has been told by the Department of Education that MVS had defaulted on an agreement to repay an outstanding bill of €161,000.

Mr O’Shea said he personally lost money on the venture because of the time and travel he invested and it was CCVEC’s conduct which prompted the contract to be terminated.

When this matter was under investigation by the C&AG, the former chief of CCVEC, Barra Ó Bríain said: “Teachers were in regular contact with the company submitting content”.

“[Teachers were] preparing audio files for inclusion in animation, conducting a review of the student testing module and testing the interactive elements sent back to the school.”

But Mr O’Shea said this did not happen.

Mr O’Shea said the partnership with Glanmire Community College began to break down within two weeks of it beginning and it fell apart altogether around the time MVS Ltd stopped paying the quarterly installments to the school.

“[The deal] fell down after two weeks. You have no idea the amount of time we spent just to communicate with the school. It was a complete nightmare and it was very inappropriate. If they told us from the start that they couldn’t do this we would have walked away,” he said.

Photographs were taken in the school in February and March 2006 of Mr O’Shea with staff and students at the launch of results of the MELS package they had developed.

At the time he told reporters the MELS software had “got a great response here in the school”.

Now he said the project was over long before this event.

“You have your dates completely wrong. That project was over in 2005 as far as I understand,” he said.

CCVEC told the C&AG and the Department of Education that efforts had been made to contact Mr O’Shea and a solicitor’s letter to the company, MVS, was returned undelivered. On this basis legal action to pursue the debt was abandoned.

Mr O’Shea had been managing director of a company with the same name in Norway, MVS AS, which was used to provide a bank reference before CCVEC borrowed €216,000 on its behalf to fund the work in Glanmire.

This reference came in the form of a fax from a bank, which confirmed the Norwegian company had a good credit rating.

Norwegian court documents, seen by the Irish Examiner, show that MVS AS was incorporated in May 2005, five months after the second draft of the Glanmire contract was signed.

The Norwegian company was established with the Irish operation as its sole founder and shareholder and its first meeting was held in MVS offices in Ireland.

The company’s auditor in Norway resigned in July 2006 after MVS failed to provide accounts for 2005.

There was a forerunner of this entity in Norway. In October 2004 this company, MVS Norge, was given NOK150,000 (€20,000) out of an overall grant of NOK200,000 (€26,300) from Innovation Norway to develop location-based software.

This grant was conditional on Innovation Norway receiving project reports and project accounts. This was not done, the outstanding 25% of the grant was not released and the money was not repaid.

Nordea Bank Norge also lodged a claim against MVS because the company’s current account was in debt to the tune of NOK29,616 (€3,800).

In the report of the court appointed receiver in Norway, it said the judge should consider disqualifying the managing director of the MVS enterprises, Mr O’Shea, from doing business.

“Since the matters as described provide grounds for assuming that due to improper business conduct he is unfit to be chairman of the board of general manager of a company,” it said.

But Mr O’Shea said he was not the only person involved in the business and had been set up as a “scapegoat” when the company collapsed.

He said the other party in the Norwegian project failed to supply the necessary investment and he had sought to rectify the negative assessment made of him in Inderoy District Court in Norway.

“I have complained about that to solicitors in Norway, that is wrong,” he said.

But he said the outcome of that complaint was confidential.

Seanad debate call

There have been calls for a Seanad debate on the Cork County VEC audit following revelations in this newspaper over the past few days.

Senator Colm Burke, Fine Gael spokesman on health, said last night: “It has been shown that teachers have been paid for 1,070 hours that were not worked and over €60,000 has been paid.

“A person was hired to drive children to a Youthreach project despite, having been convicted of rape in the UK, as there was no background check undertaken before he was employed. We are in the middle of reforming and amalgamating the VECs and we have not had a debate in this House on the future role and structure of VECs. Will the leader arrange for the minister for education and skills to come to the House? We should consider the matter and it would be appropriate to have a debate in the House.”