The intervention by Comptroller and Auditor General Seamus McCarthy at the Public Accounts Committee emerged as one member, Fianna Fáil’s Marc MacSharry, revealed that a 2010 email purportedly from Garda finance boss Michael Culhane to the Department of Justice allegedly referred to an attempt to “muddy” things up regarding taxation matters in correspondence with Revenue.
In another dramatic day at the PAC, Ms O’Sullivan said she had referred a report by the Garda internal auditor Niall Kelly to the Garda Ombudsman in which he raised suspicions that “fraud may have been committed” involving a secret garda bank account, which at its height held €90,000-plus.
The Ombudsman said the matter was sent to it “late” on Monday and that it was now “under consideration”.
The Irish Examiner understands that Gsoc, which has not conducted a major fraud investigation before, may have to contract in a forensic accountant or consider leading a multi-agency investigation as matters may also involve revenue or corporate issues.
It is thought Gsoc is seeking clarity from An Garda Síochána on the exact “scale and scope” of the investigation, but that a decision on the inquiry is expected to be made fairly quickly given the level of public interest.
PAC heard that a formal accounting letter sent by Ms O’Sullivan to Mr McCarthy on July 31, 2015, in which she is required to disclose any issues of loss, fraud, or irregularities, did not mention the emerging financial concerns surrounding Templemore.
The commissioner, questioned yesterday for more than six hours, said she was first informed of these issues on July 27, 2015.
Mr McCarthy said that any question about potential irregularities was something “that should have been made known to me” so he could independently carry out his own function.
The commissioner said she did not have full information and to get a “complete picture” she set up a working group on July 28 to gather all the information.
However, Mr McCarthy said he should still have been informed, even if the commissioner only had “basic” or “partial” information, and added: “I’m quite clear it should have been brought to my attention.”
The commissioner said that she would have reported it “if I knew then what I know now”.
Sinn Féin’s David Cullinane said it “called into question” whether the commissioner’s letter to the C&AG was “accurate or inaccurate” and added: “That, for me, is quite serious.”
His party’s deputy leader, Mary Lou McDonald, accused the commissioner of “misleading” the C&AG — which Ms O’Sullivan rejected.
In a dramatic development, Mr MacSharry referred to a July 2010 email purportedly from Garda finance director Michael Culhane to the Department of Justice’s garda division in which he allegedly said that in correspondence on tax matters with Revenue he had included a reference to charity status to “muddy things up”. He said this referred to another email from auditors PwC to Mr Culhane which said gardaí could argue charity status for all investment income.
Ms O’Sullivan said she was “disadvantaged” as she was only seeing the emails now, but said the language was “unusual”.
Mr MacSharry said he got the documentation from Garda chief administrative officer Joe Nugent, who accompanied Ms O’Sullivan, during the lunch break.
Meanwhile, the chair of the Policing Authority, Josephine Feehily, has said she is “disappointed and alarmed” with the widespread failures in practices within An Garda Siochana.